New strategy for VRG S.A.

The Capital Group has accepted a Development Strategy for 2023 - 2025, with a focus on modern brands, omnichannel development, and increasing value for shareholders

According to the Capital Group's Strategy, revenues at the end of 2025 should approach PLN 1.9 billion (compared to PLN 1.3 billion at the end of 2022). The Group anticipates a net profit of more than PLN 150 million. It also aims for double-digit sales growth in each year of the Strategy's realization, which should ultimately affect a minimum 14% share of its revenues online in 2025.

VRG S.A.'s strategy is to increase the Group's value through business scale development, increase operating margins in the apparel and jewelry segments, and increase the Group's net profit. The Company's goal is to have a gross sales margin of between 56-57% by the end of 2025.

- The Group's top priority is profitable growth and organic development throughout the years of the Strategy. Bearing in mind the experience and recognition of the Group's brands, we plan to implement our activities for further growth in these areas. - says Janusz Płocica, CEO of the VRG Group. - Our goal is to support growth through funds generated by the Group and to continue the dividend policy adopted in 2022.

One of the VRG Strategy's pillars is the development of each of its brands, by expanding its target customer group with a stronger entry into growing women's collections. The Group is focusing on the modernity of the brands, by incorporating the latest market trends into the apparel segment's collections and increasing the brand's recognition among women. In 2025, Vistula plans to achieve a 15 percent share of its women's collection (compared to a 2 percent share in 2022), while Wólczanka's goal in this area is to reach 50 percent (compared to 30 percent in 2022). The Group intends to take advantage of the know-how and experience of the Wólczanka and Deni Cler brands in introducing women's offerings. In addition, it plans to enable the sale of part of the collection exclusively in the online channel.

The goal of the VRG Group's jewelry segment for 2025 is to position W.KRUK as the first choice for customers in the area of watches and luxury jewelry. As Poland's oldest jewelry brand, W.KRUK plans to emphasize its tradition, while developing its offer towards younger customers and supporting its market position with sales in the online channel. The company anticipates that the planned activities will result in sales revenues of PLN 900 million at the end of 2025 (compared to PLN 626 million at the end of 2022).

The VRG Group will continue its growth in the omnichannel model. The plan to upgrade and develop the Group's own stores in both segments assumes that by the end of 2025, the Company will have an area of approximately 62,700 square meters. Another goal is also to develop online sales channels, expanding 6 of the Company's own e-stores by the end of 2025, as well as expanding the availability of the Group's brands on marketplace platforms. The Group plans to accelerate online growth in order to have a wider presence among domestic and foreign customers. The strategy assumes that in 2023 - 2025, the Group will aim to build brand recognition in the international market, in the CEE region. Actions will be taken based on their profitability.

– Omnichannel is the future of retail, so the Group's goal is to optimize this area. We intend to make the purchase path shorter and provide customers with the integrity of online and offline sales channels. To support the omnichannel model, we will implement the development of sales Apps for all Group brands. - says Janusz Płocica, CEO of VRG Group. - The upcoming years will also be for us the start of a journey in building the presence of the Group's brands on the international market. We will undertake further activities based on our experience in the development of the Company in the Polish market and including the cost side.

With customers' values in mind, the Company will continue to keep a responsible and active view of the market. The Strategy includes activities for the environment, social issues, and corporate governance. The Group will continue activities aimed at minimizing the Company's impact on the environment.

The content of the report of results is available under the link: https://www.vrg.pl/dla-inwestorow/raporty-biezace

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VRG S.A. (former name Vistula Group S.A.) is a company listed on the Warsaw Stock Exchange S.A. since 1993. VRG Group S.A. specializes in the design and distribution of high-quality fashion collections for men and women and jewelry. It owns highly recognizable trademarks in five major lines: Vistula, Bytom, Wólczanka, Deni Cler Milano and W.KRUK. The VRG S.A. Group focuses on brand management, apparel and jewelry design and the development of its own sales network in both main segments (apparel and jewelry).