The 2020 financial statements have been prepared for the first time in accordance with International Financial Reporting Standards (IFRS)1
Despite last year's challenges faced by many industries during the pandemic, AS “Virši-A”, the fastest growing local fuel and alternative energy source trader in Latvia, together with related group companies (hereinafter - “Virši”) continued their successful development, showing record high profit indicators. According to the consolidated annual report of “Virši”, the profit at the group level in 2020 reached almost 4.2 million euros, which is 17.8% more than a year earlier, while EBITDA reached 7.8 million euros, which is an increase of 6.5%. Last year, “Virši” transferred 43.6 million euros in tax payments to the Latvian state budget.
“In preparation for the initial public offering (IPO) in the second half of this year, we have made a number of extensive and significant preparations to make “Virši” an even more transparent company for investors in the future. We have reorganised and consolidated the Company at the group level, and 2020 became the first year when “Virši” financial statements were prepared in accordance with International Financial Reporting Standards at the consolidated group level. This offers significant benefits to both business and investors by ensuring that financial information is globally comparable with any other company in the industry, regardless of the country in which it operates. Until now, “Virši” annual financial statements have been prepared in accordance with Latvian Accounting Standards (LAS),” explains Vita Čirjevska, Member of the Board and Financial Director of “Virši”.
Despite the fact that the total fuel retail market in Latvia decreased by 3.6% in 2020, “Virši” was not only able to increase its market share, but to also increase the volume of fuel sold in both retail and wholesale sectors, compared to 2019. Last year, the Company's retail sales turnover increased by 3.6 million euros or 16.1%, which is the highest sales volume in the Company's history. This was facilitated by rapid adaptation to the new market conditions, as well as purposeful investments in the network of filling stations and the development of the assortment of locally prepared meals, thus contributing to the growth of the active customer base.
“Last year was one of the most challenging, but at the same time the most successful year in the Company's history. On the one hand, we felt the effects of the pandemic, which introduced significant adjustments in the business environment and reduced market demand for fuel products. On the other hand, we were able to increase our market shares in key business segments by mitigating the negative impact of the pandemic on the fuel and goods retail market. Despite the circumstances, we continued to implement the Company's strategic investment plan, which allowed us to achieve our goals thoughtfully and persistently. At this moment, we can be proud of our strong business performance and customer trust, which, despite various challenges, provides the Company with opportunities for ongoing growth,” comments Jānis Vība, Chairman of the Board and CEO of “Virši”.
In accordance with its development strategy in 2020, “Virši” significantly expanded and modernised its network of filling stations, continued to provide consistently high-quality products and services to customers, as well as promoted the availability of more environmentally friendly alternative fuels, including CNG or compressed natural gas in Latvia. Last year, the “Virši” station network consisted of 63 filling stations, four of which offered CNG. Along with the growth of the Company, last year the number of “Virši” employees also increased by 6% - it has increased to 552 people working throughout all regions of Latvia.
Commenting this year's plans, Jānis Vība emphasises: “Convincing financial results and 25 years of the “Virši” success story are the results of persistent work. Our goals for this year are even more ambitious - in the second half of the year we plan to start listing the Company's shares on the Nasdaq Baltic alternative stock market First North! Raising capital to boost future growth through the initial public offering of shares is part of the new growth strategy. Every resident of Estonia, Latvia and Lithuania will be able to apply for the planned share issue in the second half of this year, including our customers, cooperation partners and employees who have helped to create “Virši” into what we are today. We want to give everyone the opportunity to get involved in our business - to become a shareholder in our Company, to continue to manage and grow together.”
The consolidated annual report of the “Virši” Group is available on the Company's website: www.virsi.lv/en/about-us/documents
In order to inform potential investors about the Company's developments on the way to the stock exchange, a special section is available on the website: www.virsi.lv/for-investors
The information contained in this announcement does not constitute investment advice nor an offer. The information provided in this announcement contains general forward-looking announcements and the intention of AS “Virši-A” regarding a possible initial public offering (IPO). Any investment decision must be based on a prospectus approved by the Latvian Financial and Capital Market Commission.
1 IFRS - International Financial Reporting Standards (IFRSs) are internationally accepted guidelines that increase the transparency and comparability of companies' finances by enabling companies to apply common, international financial accounting principles and methods regardless of their country of operation.
2 EBITDA - Earnings before interest, taxes, depreciation, and amortisation - Earnings before interest, taxes, depreciation and amortisation are financial indicators of a company's ability to make a profit - how much profit it can make from assets and activities for sale.
“Virši” communication consultant