27 May, 2019
ELKO Group’s turnover exceeds $1.5 billion
Expanding into new markets, broadening the product range, and successful operations in existing markets have enabled ELKO Group to grow.
The main consolidated financial data for 2018:
- Revenue reached USD 1 768 million (EUR 1 497 million), up by 11% year-on-year;
- The gross profit margin was 4.7%, down by 0.2 percentage points year-on-year;
- Gross profit amounted to USD 83 million (EUR 70 million), up by 6% year-on-year;
- Net profit totaled USD 9.4 million (EUR 8 million), down by 32% year-on-year.
"Despite a challenging geopolitical situation in the CIS region, and increasing competition in all ELKO target markets, we have attained an 11% revenue increase and are aiming for 2 billion in 2019. It is quite an ambitious goal, but we do see that there is potential and opportunities to reach it. The key events of 2018 were our geographic expansion, the maintenance of efficient and cost-effective distribution channels, the constant effort to develop our portfolio and our focus on added-value products, services and solutions. We predict that the growth rate will not slow down in 2019 either," Svens Dinsdorfs, CEO of ELKO Group.
Significant events during 2018
In 2018, ELKO carried out a number of purchase transactions, the most significant of which was the acquisition of the Absolut trading house in Russia. This allowed ELKO to offer household appliances and electronics to a new market. In Slovakia WESTech, a branch of ELKO Group, acquired shares of retailers Arašid and MP3.sk, thereby expanding its portfolio of games, consoles, mobile phones and phone accessories.
As part of an initiative to broaden its business horizons ELKO Group started operating in the Polish market in 2017 recruiting a local sales team for distributing IT and consumer electronics goods. A reliable sales team with systematic business procedures was established within a year. The rapid growth rate allowed ELKO’s Polish branch to be among the TOP 15 largest wholesalers in the region.
Thanks to acquisitions, portfolio growth, and developing distribution channels, the Baltic States and the CIS region have also shown significant growth. The year 2018 marks increasing investment in regional relationship-building, targeted work with clients, and many important organizational processes aimed at transforming and strengthening market positions.
Focus on internal development
“It is important to highlight our focus on improving internal processes – last year we updated several systems, we invested in automated and effective e-commerce, the operational system JD Edwards and others. ELKO stands out with the knowledge and experience we have accumulated over 26 years of operation. We believe that our role as a distributor is to use this knowledge and make it accessible to our customers. That means constant technological development, learning and growing by utilizing the knowledge of our employees and by following business trends. We are confident that all of this will help improve our daily operations and the customer service we provide,” adds Svens Dinsdorfs.
In 2018, the company’s growth was noticed and recognized with by various awards and nominations. ELKO Group has entered the prestigious list of Central and Eastern Europe’s 500 largest companies – COFACE. ELKO comes in at in 124th place, holding the highest position among the six Latvian companies on the list. In turn, the annual award ceremony held by newspaper Dienas Bizness awarded named ELKO as the top holding company in Latvia. ELKO Group also received several partner awards.
About ELKO Group
ELKO Group is one of the region's largest distributors of IT and consumer electronics products and solutions representing 400 IT manufacturers. The Group provides a wide range of products and services to more than 10 000 retailers, local computer manufacturers, system integrators and enterprises within various sectors in 31 countries across Europe and Central Asia. The Group’s turnover in 2018 amounted to USD 1 768 million (EUR 1 497 million).