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Letter from the ceo

Letter from the ceo

Dear shareholders,

In this 2021 Logista Group Integrated Annual Report, you will be able to read in detail the main actions carried out in the year that we have just concluded, as well as the results corresponding to said period.

I am pleased to announce that we have achieved highly positive results in a context that did not appear to be favourable at all, due to the economic and social consequences that the COVID-19 pandemic brought. However, as reflected in the financial data contained in this report, we have managed not only to maintain our activity, but to continue growing and improving our position as a strategic partner for product distribution in Southern Europe.

About a year ago, in our annual report, I mentioned that we were closing 2020 without having yet returned to full normality. There is no doubt that we have not achieved complete normality yet, and that throughout this fiscal year we have continued, once again, to suffer the impact and restrictions of this pandemic. But despite these setbacks, when it came to the decree of restrictive measures, our different Logista businesses were considered an essential activity, therefore allowing us, once more, to facilitate our clients’ day-to-day lives.

If something can be considered a turning point in 2021, it has been the arrival of the first vaccines against COVID-19. From the Group, we have contributed significantly to its distribution, with agreements with different public administrations to whom we have offered all our support and collaboration in such crucial times.

In this context, I would like to highlight Logista’s commitment to continue offering the best service to our customers, focusing special attention to sustainability, and maintaining our high level of quality and safety in all accomplished operations.

Hence, allow me to emphasize Logista Pharma’s effort, for its major and strenuous work conducted throughout this pandemic. Always aiming to improve the monitoring and control of the vaccine distribution chain, Logista Pharma launched its first-time individual and unique traceability service for COVID-19 vaccines. Thanks to this service, the different public administrations that have trusted Logista for vaccine distribution have benefited from very detailed and precise information on each of the packages delivered, thus far exceeding traceability requirements legally required. Putting this system into operation has been possible thanks to the notable investments and the experience accumulated over these last few years.

At the same time, Nacex has continued to make progress to adapt to the market environment. We have launched new services that respond to the growing demand of the e-commerce market. This is the case of eNacex Economy, a system designed to make delivery more comfortable for the recipient and guarantee effectiveness in the first delivery attempt. These new solutions are in line with Nacex’s commitment to the environment and the reduction of its Carbon Footprint.

The significant increase in sales of electronic transactions in France – after the significant progress already registered in the previous year – confirms that clients in this sector have special trust in Logista when it comes to distributing their products.

Likewise, I would like to highlight our strategy of expanding our portfolio of convenience products distributed in Italy. This strategic process was followed by an important commercial effort to attract new customers in the beverage sector, which was coupled with a sales growth in the categories of snacks and sweets. After several years of continued economic growth, this has meant a new boost for our business in this market.

The constant innovation in which we are immersed is also reflected in our brand identity. It is part of the company’s growth strategy and the expansion of our range of products, services, and solutions, as well as the diversification in new sectors.

This evolution and growth have allowed us to achieve, in a complex context, very positive financial results that reflect the good performance of the Group’s activity. Logista has registered growth in the main figures of the income statement, achieving Revenues of 10,817 million euros, Economic Sales of 1,180 million and an Operating Profit of 240 million. This represents an increase in the figures of 3.9%, 5.6% and 12.8% compared to the previous year.

Economic Sales have registered improvements in all geographies and activities, except for tobacco distribution in France and Portugal. The double-digit increase achieved in Pharma, Parcels and in convenience products distribution in Spain and Italy stands out.

The increase in operating costs, which has been 3.2%, is below the increase recorded by Economic Sales. Therefore, the Adjusted Operating Profit margin on Economic Sales has improved compared to the previous year, being 25.2% in 2021 compared to 23.5% in 2020.

Thus, the Adjusted Operating Profit has reached 298 million euros, in a year in which we estimate that COVID-19 has not had a significant net impact on the results. This contrasts with the approximately 14 million euros of negative results that we estimated in the previous year.

The increase in Adjusted Operating Profit, lower restructuring costs, and higher financial results offset lower capital gains from asset sales and facilitated a 15.6% growth in Profit Before Tax.

At the end of this financial year, we decided to classify as an asset available for sale our subsidiary for the distribution of convenience products to points of sale that were not tobacco stores in France. This penalized the result of the year, as it resulted in discontinued operations, not only in the results of the year, but also in the estimation of their restructuring costs.

Net Profit for the year has increased 10.7% compared to the previous year, reaching 174 million euros.

For further information on these results, please have a look at the Consolidated Annual Accounts, that include the Management Report, of which this Integrated Report is part.

To conclude, I would like to especially thank the effort and drive of the entire Logista team of professionals for offering the best service to our clients. Naturally, I would also like to thank the Board of Directors for their ceaseless and constant support.

And to all of you, dear shareholders, I would like to express my absolute conviction that in the future Logista will continue growing in a sustainable way. Thank you for your trust.

Íñigo Meirás

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