MANAGEMENT REPORT

February 28, 2017

Type of activities

The types of activities performed by the JSC “Brivais Vilnis” are processing and canning of fish and fish products, wholesale of food products and other commercial activities classified nowhere else. On May 14, 2002 the company was registered in the Common commercial register of the Republic of Latvia.

Economic activities

Year 2016 is the 25^th year of operation since the Company was transformed into a Joint Stock Company. In 2016 the Company produced a total of 10.4 million cans of various types (161) of fish products, including 4.6 million cans of sprat. 10.1 million cans were sold for EUR 5.4 million.

The financial result of the year 2016 is a loss of EUR 436 174. These losses are from economic activities of the Company.

The common situation of the canned fish market is tense. There will be companies that will not survive, but those, who will survive, it will be easier. The Company must be among those companies that will overcome these difficulties.

We are working to maintain the market segment. We expect that Russia and Kazakhstan will open the market and the economic situation in the world will improve. Demand for canned products in non-traditional markets is lagging behind the production volumes. At production of lower volumes, actual costs of products become more expensive, but the market prices at the same time have fallen as a result of competition.

Net turnover of 2016 is EUR 5 430 thousand.

Result of 2016 (EUR)                                                                              (436 174)                               

Gross profit of 2016 (EUR)                                                                       399 900

The Company is a leader in product quality, we don`t use genetically modified raw materials, synthetic food additives and flavour enhancers in production.

New markets and development of new products has been set as a priority. We have visited food fairs in CIS countries, United States of Amerika, China, Hong Kong, Iran, United Arab Emirates, France, Germany, United Kingdom and other countries. In 2017, we are planning to take part in seven exhibitions in Europe and elsewhere.

At the same time we are working on development of new product group. We are using progressive packaging types.

We have got the International Food Standard (IFS) and the Kosher certificate.

The Company has set a target to stabilize production and sales in 2017 through the work done in 2016.

Arnolds Babris

Chairman of the Board