Börsiteade

Pealkiri

Baltika's unaudited financial results, first quarter of 2023

Teade

Despite  a  challenging  economic  environment,  there  are  several areas where
developments  are moving in the right direction for the Group. Processes related
to  cost  optimization,  efficiency  improvement,  and profitability enhancement
continue,  and decisions made in previous  periods are already having a positive
impact on the Group's financial results.

The  Group's total sales revenue  for the first quarter  across all channels was
2,160 thousand euros, increasing by 4% compared to the same period last year (Q1
2022: 2,075 thousand  euros). The first-quarter  gross profit was 1,150 thousand
euros (Q1 2022: 849 thousand euros), representing a 35% increase compared to the
same  period last year. The gross profit margin for this quarter improved by 12
percentage  points compared to the same time  last year and was 53%. The Group's
operating  loss in the first quarter  was 586 thousand euros, decreasing by 54%
compared  to the same period  last year. In the  first quarter, e-commerce sales
accounted for 12% (Q1 2022: 16%) of the Group's total revenue.

In  the first quarter of the year,  we continued working on updating our network
of stores:

  * In January, we closed our Ivo Nikkolo store in Vilnius Akropolis shopping
    center in Lithuania due to the end of the lease agreement. The new Ivo
    Nikkolo concept store opened in November 2022 in Vilnius Panorama shopping
    center in Lithuania has been well-received by our former Vilnius Akropolis
    center customers.
  * In February, we reopened the Ivo Nikkolo brand store located at Suur-Karja
    14 address. The store was closed in November 2020 when the legendary
    location of the Suur-Karja street store became commercially challenging due
    to the absence of tourists during the COVID pandemic.
  * In March, we opened a new Ivo Nikkolo concept store in Latvia. We replaced
    our old Ivo Nikkolo store in Galleria Riga shopping center with a new Ivo
    Nikkolo conept store.

In  February, the Group began preparations for entering the Business-to-Business
(B2B)  market. In  the B2B  segment, the  Group's focus  is on  finding business
partners  for  wholesale  and  consignment  sales  both  within  and outside the
Baltics.  The goal of entering  the B2B segment is  to support the growth of Ivo
Nikkolo  product  sales,  increase  brand  awareness,  and stabilize the Group's
liquidity position.

The  Group has continued its commitment  to addressing environmental changes. At
the  beginning of January, we joined  the packaging circular system called Tango
for  e-commerce platforms. The aim of joining the system is to reduce the amount
of  single-use  packaging  waste  generated  from  shopping  on  our  e-commerce
platform.  Our customers now have the option to order their products in reusable
packaging  called Low  imPACK and  receive a  deposit refund  upon returning the
packaging.  Among  clothing  retail  companies,  the  Group is the first to have
joined  the e-commerce packaging  circular system with  its Ivo Nikkolo brand e-
store.

The  Group's marketing and general administrative  expenses in the first quarter
were  1,870 thousand euros, decreasing  by 15% compared to  the same period last
year  (Q1 2022: 2,193 thousand  euros). The  Group has  been able to effectively
reduce  marketing and  general administrative  expenses through consistent cost-
cutting  measures,  efficiency  improvements,  and  the  closure of unprofitable
stores.

The  Group's management evaluates the results  of the first quarter as positive.
The  Group managed  to increase  the sales  revenue of  Ivo Nikkolo products and
significantly  improve  the  gross  profitability  of  the Group. The consistent
increase  in efficiency  and the  closure of  unprofitable stores have gradually
improved  the Group's financial indicators.  Increasing efficiency will continue
to be a focus for the Group going forward.

The   Group   remains  committed  to  its  chosen  strategy  and  continues  its
implementation by:

 1. Developing modern and high-quality products in its women's fashion brand,
    Ivo Nikkolo, which are available in Estonia, Latvia, and Lithuania, as well
    as through the Group's e-commerce platform in other European countries.
 2. Continuing to enhance its omnichannel strategy and the functionality of its
    e-commerce platform.
 3. Opening new Ivo Nikkolo concept stores in the Baltics.
 4. Exploring and developing new business opportunities both within and outside
    the Baltics.

Ongoing quarter

The group's sales revenue for the period of April 1, 2023, to May 29, 2023, was
1,518 thousand euros, remaining at a similar level compared to the same period
last year (April 1, 2023, to May 29, 2023: 1,532 thousand euros). The retail
sales efficiency (sales per square meter per month, EUR) was 114 EUR, increasing
by 16% compared to the same period last year.

In April, Ivo Nikkolo presented a contemporary feminine clothing and accessory
collection at two of the largest fashion events in the Baltics, namely Tallinn
Fashion Week (April 1, 2023) and Riga Fashion Week (April 20, 2023).

On May 10, 2023, we closed our Ivo Nikkolo store in Klaipeda Akropolis shopping
center in Lithuania due to the expiration of the lease agreement.

Consolidated statement of financial position

                                   March 31, 2023   Dec 31, 2022
-----------------------------------------------------------------
  ASSETS

  Current assets

  Cash and cash equivalents                   129            222

  Trade and other receivables               3,165          3,285

  Inventories                               2,066          1,960

  Total current assets                      5,359          5,467

  Non-current assets

  Deferred income tax asset                    91             91

  Trade and other receivables               2,796          2,756

  Other non-current assets                    111            107

  Property, plant, and equipment            1,364          1,269

  Right-of-use assets                       4,066          4,596

  Intangible assets                           567            586

  Total non-current assets                  8,994          9,405

  TOTAL ASSETS                             14,353         14,872



  LIABILITIES AND EQUITY

  Current liabilities

  Borrowings                                3,275          3,096

  Lease liabilities                         1,493          1,813

  Trade and other payables                  2,405          1,741

  Total current liabilities                 7,173          6,650

  Non-current liabilities

  Borrowings                                1,061          1,070

  Lease liabilities                         2,908          3,296

  Trade and other payables                    143            147

  Total non-current liabilities             4,113          4,513

  TOTAL LIABILITIES                        11,286         11,163



  EQUITY

  Share capital at par value                5,408          5,408

  Reserves                                  4,431          4,431

  Retained earnings (-losses)              -6,772         -6,130

  TOTAL EQUITY                              3,067          3,709

  TOTAL LIABILITIES AND EQUITY             14,353         14,872

Consolidated statement of profit or loss and other comprehensive income

                                                         Q1 2023        Q1 2022
-------------------------------------------------------------------------------




 Revenue                                                   2,160          2,075

 Cost of goods sold                                       -1,010         -1,226

 Gross profit                                              1,150            849



 Distribution costs                                       -1,602         -1,831

 Administrative and general expenses                        -268           -362

 Other operating income (-expense)                           133             82

 Operating profit (-loss)                                   -586         -1,262



 Interest income                                              39              0

 Interest expense                                            -94            -83

 Profit (-loss) before income tax                           -641         -1,345



 Income tax expense                                            0              0



 Total comprehensive income (-loss)
 for the period                                             -641         -1,345





 Basic earnings per share from net profit (-loss) for
 the period, EUR                                           -0.01          -0.02



 Diluted earnings per share from net profit
 (-loss) for the period, EUR                               -0.01          -0.02


Brigitta Kippak
Chairman of The Management Board, CEO
[email protected]
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