Nothing can stop us when we all move in the same direction.

Dear representatives of our owners, valued employees and business partners, and other stakeholders of the Pošta Slovenije Group!

Pošta Slovenije is the national postal operator and universal postal service provider in the Republic of Slovenia, Together with its subsidiaries that make up the Pošta Slovenije Group, it is an essential part of Slovenian society and an indispensable partner to the economy. The entire Group develops its operations in the scope of five strategic pillars – logistics services, parcels, letters via direct mail, IT solutions and sales of goods via network.

In accordance with its mission, during the last financial year that was marked by the COVID-19 epidemic, the Pošta Slovenije Group ensured the regular provision of certain postal services throughout Slovenia, thereby contributing significantly to the continuous operation of the Company, even in the adverse situation, for which our employees deserve the most credit. We were awarded a commemorative token by the Government of the Republic of Slovenia for sacrifices made in the fight against COVID-19.

We carried out crucial planned projects and activities

The virus that shaped the year globally also affected the operations of the Pošta Slovenije Group and the way we approach our work. Last year demanded a large amount of adjustments from all of us. Due to the COVID-19 pandemic and the measures associated therewith, we adopted a revised business plan for 2020 and carried out crucial planned projects and activities. At the global level, the COVID-19 pandemic accelerated the development of digitalisation, online shop and parcel operations, which was also reflected in the operation of the Pošta Slovenije Group.

We continued with integration activities

The 2020 financial year was also marked by the consolidation of the ownership of shares in Intereuropa in Slovenia, by the publication of takeover bids in Slovenia and in the region, and the integration of Intereuropa into the Pošta Slovenije Group. We worked intensively on performing integration activities in all major work flows, such as logistics, sales, IT, procurement, real estate, and in all key support functions, mostly focusing on achieving synergistic effects, optimising operations and on the centralisation of certain support functions of Intereuropa within the Pošta Slovenije Group.

Together with the Intereuropa Group, the Company will be more successful on its path to becoming a leading, independent provider of logistics and parcel services for end-customers in the region. Together, we will be able to recognise the challenges of the industry in which we operate as new opportunities and to strengthen our competitiveness on the market more effectively.

High growth in parcel operations

Despite the COVID-19 pandemic, which has had a significant impact on our operations, the Pošta Slovenije Group ended the 2020 financial year with a profit of EUR 5.2 million (EUR 4.5 million of that pertaining to controlling interests). We generated EUR 426.7 million in operating revenues, of which EUR 152.6 million was accounted for by the Intereuropa Group, while Pošta Slovenije's revenues, the largest proportion of which was accounted for by revenues from postal services, accounted for 56.4% of the Group's total revenues. In the context of the envisaged decline in letter services and network services these revenues were mostly generated due to the high growth in parcel operations, which the COVID-19 pandemic only accelerated. In accordance with the global forecasts, this trend will also continue in the future. Just not to the same extent as during the closure of shops. In terms of parcel and logistics operations, we are planning continued growth in revenues in the coming years.

During the 2020 financial year the Pošta Slovenije Group also received a few notable domestic and foreign awards and prizes, among these a commemorative token awarded to Pošta Slovenije's employees by the Government of the Republic of Slovenia for sacrifices made in the fight against COVID-19. With our Energy Efficiency and Sustainable Development Strategy we participated in the “2020 CSR Coups de Coeur” competition run by PostEurop for Corporate Social Responsibility awards in the Environmental Category, and were ranked among the 20 best operators and practices. Last year Pošta Slovenije was also awarded a silver plaque at the EMS Performance Awards for the second consecutive year for the quality of delivery of international EMS parcels in Slovenia, which is presented by the Universal Postal Union (UPU).

1.2 STATEMENT OF

THE GENERAL MANAGER AD

INTERIM OF POŠTA SLOVENIJE

We earmarked EUR 22 million for investments in the previous financial year. Capital expenditure at Pošta Slovenije was earmarked for current operations, investments in the network, in particular to upgrade its environmentally-friendly vehicle fleet and build additional space capacities for delivery and logistical post offices, as well as earmarking resources for warehouse capacities, information technology and logistical equipment.

Growth and development based on outlined strategic bases

Despite the considerable challenges, the Pošta Slovenije Group ended the 2020 financial year in good shape, achieving the business objectives for 2021 and following the Strategic Development Programme of the Pošta Slovenije Group for the period up to 2025. In January 2020 it was approved by the Slovenian Sovereign Holding Company, which at the beginning of 2021 also gave its consent to the revised financial projection for the strategic development plan. It takes into account the impact of the pandemic and detailed information regarding the operations and strategic plans of the Intereuropa Group.

The Pošta Slovenije Group remains ambitious in its development plans, by planning to generate more than half a billion euros in revenues in 2025. More than EUR 39 million in investment funds will be earmarked in 2021 to accelerate the transformation of operations, in particular investing in space and transport capacities, including electric vehicles and charging infrastructure, logistics equipment, computerisation and digitalisation of operations, and also to expand the Group's operations on foreign markets.

We will also continue with the consolidation of ownership, integration of business functions at the Intereuropa Group and the realisation of common synergies. We plan to increase the space capacities for parcel and logistics operations, upgrade parcel products, develop a regional parcel network and penetrate the Croatian parcel market. We already offer IT services under the uniform brand Posita, but still have to continue the computerisation of operations and optimisation of the postal network. The initiative regarding priority and non-priority mail items is categorised among major changes.

In recent years the Pošta Slovenije Group has evolved into a modern and responsible company. This great progress was stimulated by external and internal factors, and was mostly facilitated by the vast knowledge of our in-house experts and the wealth of experience held by the entire collective. With a clear vision and an outlined direction of development, we will remain an important part of society and an indispensable partner to the economy in the 2021 financial year and in the years to come, and also strive for even greater satisfaction of all our stakeholders.

Tomaž Kokot

General Manager Ad Interim