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ASBIS Remain Strong and Improves its Cost Structure

ASBIS Remain Strong and Improves its Cost Structure

Results of Q1 2009 Under heavy Influence of Currency Movements and the Crisis

Results of Q1 2009 Under heavy Influence of Currency Movements and the Crisis

Limassol, May 6th, 2009.-- ASBISc Enterprises Plc (“ASBIS”), a leading distributor of IT products on fast growing markets of Central and Eastern Europe, the former Soviet Union, and the Middle East and North Africa, generated revenue of USD 237.91 million and net loss of USD 6.19 million. The Company’s operations were negatively affected by the ongoing instability in a small number of its markets – in particular Russia and Ukraine. Moreover, the fragile economic environment resulted in   currency losses of US$ 5.7 million, which is not expected to be recurring. The Group has reduced its Selling and Administrative expenses by 34,4% compared to Q4 2008.

“We knew it is going to be tough, it is tough for everyone. With very steep depreciation of currencies- like the Ruble, the Czech Crown, the Polish Zloty, etc. in January. We did everything possible under these turbulent circumstances. The last resort was to limit sales and we undertook this measure as well in February – March; we could not risk it anymore. I strongly believe we had our share of foreign exchange losses.” - said Siarhei Kostevitch, ASBIS CEO

MESURES UNDERTAKEN TO MITIGATE EFFECTS OF THE CRISIS

ASBIS has continued actions started in 2008 undertaken to mitigate the effects of the crisis and currency vulnerability on its results:

a)      The Company has continued cost-cutting actions started back in November 2008. This included savings on overheads and other costs, including lower costs of particular departments.

b)      The Company has increased its U.S. Dollar denominated sales, to decrease its foreign exchange exposure (as it mainly purchases goods in U.S. Dollars and principally sells in local currencies)

c)      The Company improved both short term and long term hedging strategies in its local subsidiaries

d)      The Company improved credit risk management

“Despite the negative economic environment, we are focused and committed to reverse things. Cost cutting actions started from November last year are continuing and will be continued for as long as are needed. Investments made in 2008 (Turkey, Saudi Arabia, etc) started paying off and we are positive for their contribution to the overall results of the group during the current year. Countries less affected by the crisis are the ones we gain market share and strengthening our market position. ASBIS has always been adoptive to changes and this time is not an exception. We are taking all appropriate measures to ensure that ASBIS comes out of this crisis much stronger. We remain calm and doing what we know better during the 14 years of our existence, distributing for our stakeholders’ success”   - - commented Siarhei Kostevitch, ASBIS CEO.

FINANCIAL PERFORMANCE IN Q1 2009

In USD m

Q1 2009

Q1 2008

Change

Revenues from sale

237,914

360,082

-33.9%

Gross profit from sale

7,179

21,670

-66,9%

Operating profit/loss

-4,647

8,856

---

EBITDA

-3,923

9,419

---

Net result

-6,194

5,528

---

DETAILED INFORMATION ON SALES STRUCTURE

Q1 2009 was characterised by lower revenues from main product lines, arising from the world’s financial crisis and lower average sales price (“ASP”). Additionally, sales on small number of main Company’s markets – particularly in Russia and Ukraine - was lower than expected, and significantly lower than historically best Q12008. This negative difference in revenues generated on some of the Company’s biggest markets, was partially offset by good growth from the Middle East region and some countries of CEE, like the Czech Republic.

Slovakia was again the Company’s second biggest market, mostly due to stable demand in this country and strong market position in the country. Following the Company‘s investments in 2008, new countries started paying off and their growth was significant. Saudi Arabia with +112.2% growth, and Turkey with +95.3% growth joined the Company’s Top 10 markets in Q1 2009.

The table below demonstrates the Company’s largest markets by revenue for the period ended 31st March 2009:

Revenue breakdown – Top 10 countries in Q1 2009 and Q1 2008 (in U.S. Dollar thousands)

Pos.

Country

Sales Q1 2009

Sales Q1 2008

Change (%)

Share (%)

1.

Russia

34,614

107,877

-67.9%

14.6%

2.

Slovakia

32,216

34,845

-7.5%

13.5%

3.

Ukraine

21,326

35,175

-39.4%

9.0%

4.

United Arab Emirates

18,073

19,780

-8.6%

7.6%

5.

CzechRepublic

15,645

12,958

+20.7%

6.6%

6.

Poland

11,127

16,081

-30.8%

4.7%

7.

Netherlands

9,931

10,338

-3.9%

4.2%

8.

Saudi Arabia

7,877

3,713

+112.2%

3.3%

9.

Turkey

7,629

3,907

+95.3%

3.2%

10.

Bulgaria

7,163

9,140

-21.6%

3.0%

11.

Other

72,314

106,268

-32.0%

30.4%

For additional information, please contact:

Mr Daniel Kordel, ASBISc Enterprises PLC, Investor Relations

Tel. +48 509 020 021, +357 97 633 793

e-mail: d.kordel@asbis.com

Mr Costas Tziamalis, ASBISc Enterprises PLC, Investor Relations
tel. +357 25 857 000

e-mail: costas@asbis.com

For more information, visit also the company's website at www.asbis.com

ASBISc Enterprises Plc is based in Cyprus and specializes in the distribution of computer hardware  and software, blocks and peripherals, and a wide range of IT products and digital equipment. Established in 1995, the Company has a presence in Central and Eastern Europe, the Baltic States, the former USSR, the Middle East, and North Africa.

The Group distributes products of many vendors and manufactures and sells private-label products: Prestigio (LCD monitors, laptops, external storage, leather-coated USB accessories, GPS devices, etc.) and Canyon (MP3 players, networking products and other peripheral devices).

ASBIS has subsidiaries in 26 countries, more than 1,000 employees and 30,000 customers.

The company’s stock has been listed on the Warsaw Stock Exchange since October 2007 under the ticker symbol “ASB” (ASBIS). More information about the company: www.asbis.com

Disclaimer: The information contained in each press release posted on this site was factually accurate on the date it was issued. While these press releases and other materials remain on the Company's website, the Company assumes no duty to update the information to reflect subsequent developments. Consequently, readers of the press releases and other materials should not rely upon the information as current or accurate after their issuance dates.