2021 SOCIAL & ECONOMIC IMPACT REPORT
The report presents data of 2020.
© GALAXY GROUP OF COMPANIES. ALL RIGHTS RESERVED 2021 No part of the content or the content in complete in this Report may be used without the written consent of the Galaxy Group of Companies.
TABLE OF CONTENTS
3 GURGEN KHACHATRYAN'S ADDRESS
GALAXY GROUP OF COMANIES / 2021
4 ABOUT THE COMPANY
2
Stone is durability, stone is a symbol of strength and stability. The stone is longevity, it also serves as the foundation - the stronger the cornerstone, the more powerful the whole structure. The stone
OUR STORY
builds, creates, improving lives and communities. It is one of the
COMPANIES UNDER GALAXY GROUP
most important parts of human life, the significance of which has
GALAXY’S WORLD-WIDE BUSINESS RELATIONS
remained the same.
8 GALAXY COMMUNITY IN NUMBERS
GALAXY COMMUNITY DEMOGRAPHIC PROFILE
11 SOCIO-ECONOMIC IMPACT
EmployeesS AND SALARY FUND
JOB PROFILE AND SALARY COMPARISON
17 ECONOMIC ACTIVITY IN NUMBERS
TAXES PAID IN 2020
ACQUISITIONS FROM LOCAL MARKET IN 2020
IMPACT. FINANCES AND BANKING IN 2020
Galaxy Group of Companies chose the symbol of stone as the concept of this annual Impact Report. Only by “laying a stone upon stone” is it possible to restore our life and our homeland. The stone symbolically connects us with our past, the most distant, unforgettable times of our history, while guiding the way towards the future, to be built upon the strength of a stone in order to be resistant and ready for any challenge. Crises are temporary, stones are permanent and tenacious.
GURGEN KHACHATRYAN'S ADDRESS
3
our teams and business continuity. The crises were an opportunity for
is AMD 364,716 and last year, more than AMD 2 billion in income taxes
us to show our unity as well as ingenuity to find new, unexpected solutions
was transferred to the state budget.
in the face of adversity. At the same time, they also served as a test for our values and strength. It is with great assurance that I can state that we managed to record balanced results thanks in large part to the professionalism, responsibility and dedicated work of our teams, for which I am grateful to the team.
GALAXY GROUP OF COMANIES / 2021
“Human comes first” was a guiding point for us, in the context of which we managed to achieve high results in a short time from the first day of the outbreak, with preventive solutions, increased team readiness and stress resilience.
In 2021 we will continue our development projects and will complete our three major projects with international and local capital in the field of hotel construction, hospitality and services as well as the construction of an IT infrastructure of regional significance. In 2021, we are also preparing to implement new and more comprehensive social responsibility programs aimed at improving the quality of life of people. Having accountability towards our employees and their families, our nation and the state, we believe that we can make our modest yet vital contribution to the recovery of Armenia's economy.
The war was undoubtedly the most difficult stage, during which our companies and employees provided support in various ways. Our contribution included but was not limited to technical assistance, the implementation of complex communication measures, the hosting of
"TRUST, STABILITY AND BUSINESS CONTINUITY
IN A YEAR OF CRISES. LESSONS FROM 2020 FOR GALAXY GROUP OF COMPANIES"
authoritative international media in Armenia and Artsakh, the organization of shelter and support for the civilian population, and direct donations. I would like to emphasize that despite the difficulties, our relationship with local and international partners has not suffered a bit. Moreover, we have initiated more ambitious programs, continuing to ensure the stable
Last year's crises had a negative effect on the economy. The pandemic not only disrupted normal life, but also showed how unprepared states and corporations were in dealing with crises via systemic solutions. The year of 2020 was especially difficult for us—a war with painful losses combined with political and economic instability, corporate pressures and other consequences left by the pandemic. Even though it would be naïve of us to think we overcame all of the challenges, we, nonetheless, managed to make it through the year accomplishing a feat we deem very important, that is maintaining the complete integrity of
representation of our international partners in Armenia. In spite of the inevitable economic losses, last year Galaxy Group of Companies contributed more than AMD 11.5 billion (more than USD 22 million) to the RA state budget in the form of tax payments. Purchases from the local market amounted to around USD 36 million which has a significant impact on the national GDP. The Group’s loan portfolio amounted to around AMD 60 billion (around USD 115 million). I would like to note that the average monthly salary in Galaxy Group of Companies
GURGEN KHACHATRYAN Co-founder and Co-Chairman Galaxy Group of Companies
GALAXY GROUP OF COMANIES / 2021
4
ABOUT THE COMPANY
ABOUT THE COMPANY
GALAXY COMMUNITY IN NUMBERS
SOCIO-ECONOMIC IMPACT
ECONOMIC ACTIVITY IN NUMBERS
OUR STORY
5
Behind the lucrative image of a multi-industry, successful
others to follow suit, whilst maintaining the characteristics unique
corporation hides the over 20 years long process of hard work,
to them.
GALAXY GROUP OF COMANIES / 2021
trials and tribulations, failures that are masked by the eventual outcome. Galaxy Group of Companies was not an overnight
However, among the many feats we have accomplished over the
success, far from it. On the contrary, it was the result of consistency
years, what we take the most pride in is the fact that Galaxy Group
and resilience; the dozens of mistakes made along the way mixed
of Companies is formed with capital of entirely Armenian origin.
with the willingness to accept and learn from those experiences.
Our primary objective with each company that we establish is to contribute to the development of Armenia’s economy and to
Before forming Galaxy Group of Companies, co-founders Gurgen,
improve the quality of life of our community. It is our belief that the
Artyom and Aram Khachatryan were just a couple of young
well-being and prosperity of our company is directly correlated
brothers who aspired to be entrepreneurs. They tried their hands
with that of our country—therefore, in this mutually symbiotic
at starting multiple small businesses in their youth, all of which
relationship, we have to ensure that we hold our end of the deal
did come to the same unfortunate conclusion. However, to let a
and do our part in developing Armenia.
handful of unsuccessful attempts discourage them from trying for more would go against their personal principles—the very same set of principles which Galaxy Group was later founded and built
Our story is not unique by any means. Nor is it an over-glorified
upon.
underdog story. We did not have a sudden rise to the glory, did not experience ups and downs of galactic scale. Our story does
Our corporate history traces back to 1999, from which point on
not resemble that of a business fairy tale propagated by fictitious
the Galaxy Group of Companies of today has been formed step
literature. Galaxy Group of Companies is just an example of a
by step, overcoming multitudes of challenges along the way. From
company operating on a fundamentally sound basis, sticking to
an idea to a project, from a project to a company—Galaxy Group
its guns through thick and thin without letting external pressure
has created its companies from the ground up. In a 20-year span,
get in the way. We take no shortcuts, do not compromise our
we have managed to expand and diversify our business portfolio,
quality for short-term gains and, ultimately, never put personal
establish brands beloved by customers, enter and innovate a
interests above those of the institution. We let our work do the
variety of industries. Our companies have become leaders in their
talking—success is merely its by-product.
respective industries, setting new benchmarks and standards for
ABOUT THE COMPANY
GALAXY COMMUNITY IN NUMBERS
SOCIO-ECONOMIC IMPACT
ECONOMIC ACTIVITY IN NUMBERS
COMPANIES UNDER GALAXY GROUP
6
GALAXY GROUP OF COMANIES / 2021
Galaxy Group serves as the holding company of 15 business units, reserving the role of management and strategic development of its subsidiaries. Offering a completely new culture and innovative products, our companies are all unique in their own right. We are all united around the same purpose, that is to find the best solutions for effective service delivery.
COMMERCIAL REAL ESTATE & CONSTRUCTION
ENTERTAINMENT & HOSPITALITY
IMPORTATION & PRODUCTION
ABOUT THE COMPANY
RETAIL & CONSUMER GOODS
GALAXY COMMUNITY IN NUMBERS
TELECOMMUNICATION & IT
SOCIO-ECONOMIC IMPACT
ECONOMIC ACTIVITY IN NUMBERS
GALAXY’S WORLD-WIDE RELATIONS
7
GALAXY GROUP OF COMANIES / 2021
A journey is best measured by friends rather than miles. Throughout 20+ years of our journey, we have established and proudly maintained strategic partnerships with 200+ partner companies from over 20 major business destinations in the world.
Sweden Denmark Norway Netherlands UK France Germany Switzerland Austria Spain Italy Greece Russia Ukraine Bulgaria Poland USA UAE Japan Taiwan China
ABOUT THE COMPANY
GALAXY COMMUNITY IN NUMBERS
SOCIO-ECONOMIC IMPACT
ECONOMIC ACTIVITY IN NUMBERS
GALAXY GROUP OF COMANIES / 2021
8
GALAXY COMMUNITY IN NUMBERS
ABOUT THE COMPANY
GALAXY COMMUNITY IN NUMBERS
SOCIO-ECONOMIC IMPACT
ECONOMIC ACTIVITY IN NUMBERS
GALAXY COMMUNITY IN NUMBERS
GALAXY GROUP OF COMANIES / 2021
Followers of the group of companies in Armenia
Access to every third family in Armenia Active customers
9
1,500,000+ 1,000,000 800,000+ ABOUT THE COMPANY
GALAXY COMMUNITY IN NUMBERS
SOCIO-ECONOMIC IMPACT
ECONOMIC ACTIVITY IN NUMBERS
GALAXY GROUP OF COMANIES / 2021
GALAXY COMMUNITY DEMOGRAPHIC PROFILE
HIGHER EDUCATION
MEDIUM AND HIGH INCOME GROUP
18-55 YO
SOCIALIZING: active walking, purchase, public food centers
10
WOMEN 58%
76% INTERNET AS THE PRIMARY SOURCE OF INFORMATION
82% PAID Employees (PRIVATE AND PUBLIC SECTORS)
DEMOGRAPHIC
MEN
URBAN POPULATION
42%
46.3% CRITICAL MASS, CIVIL ACTIVISM
BEHAVIOR
ABOUT THE COMPANY
GALAXY COMMUNITY IN NUMBERS
SOCIO-ECONOMIC IMPACT
ECONOMIC ACTIVITY IN NUMBERS
GALAXY GROUP OF COMANIES / 2021
11
SOCIO-ECONOMIC IMPACT
ABOUT THE COMPANY
GALAXY COMMUNITY IN NUMBERS
SOCIO-ECONOMIC IMPACT
ECONOMIC ACTIVITY IN NUMBERS
EMPLOYESS AND SALARY FUND
12
RA
*
2.148 bln AMD ** GALAXY GROUP OF COMANIES / 2021
Paid income tax
2020
364,716 AMD
Average monthly income
2,209
employees
194,450 AMD
Average monthly income
*** 429,205
employees
3.709 bln AMD Paid income tax
2019
376,165 AMD
Average monthly income
2,864
employees
183,300 AMD
Average monthly income
*** 421,179
employees
* RA - Republic of Armenia ** AMD - Armenian Dram (currency) *** Private sector
ABOUT THE COMPANY
GALAXY COMMUNITY IN NUMBERS
SOCIO-ECONOMIC IMPACT
ECONOMIC ACTIVITY IN NUMBERS
EMPLOYESS AND SALARY FUND
13
GALAXY GROUP OF COMANIES / 2021
Salary increase dynamics 2018
2019
2020
400,000 AMD 300,000 AMD 200,000 AMD 100,000 AMD 0 AMD
314,058 AMD
181,865 AMD
376,165 AMD
187,300 AMD
364,716 AMD
194,450 AMD
GALAXY RA
ABOUT THE COMPANY
GALAXY COMMUNITY IN NUMBERS
SOCIO-ECONOMIC IMPACT
ECONOMIC ACTIVITY IN NUMBERS
EMPLOYESS AND SALARY FUND
14
GALAXY GROUP OF COMANIES / 2021
Gender distribution
2,209 employees 50.8%
1,122
Men
1,087
49.2%
Women
ABOUT THE COMPANY
GALAXY COMMUNITY IN NUMBERS
SOCIO-ECONOMIC IMPACT
ECONOMIC ACTIVITY IN NUMBERS
JOB PROFILE AND SALARY COMPARISON
15
GALAXY GROUP OF COMANIES / 2021
Salaries based on company size 2020
2019
1-9 employees
229,938 AMD 109,782 AMD
138,280 AMD
10 - 49 employees
252,647 AMD 90,953 AMD
259,240 AMD
50 - 249 employees
297,655 AMD 88,909 AMD
291,997 AMD
> 250 employees
394,242 AMD 139,561 AMD
383,663 AMD
0
200,000 AMD
95,679 AMD
95,516 AMD
90,569 AMD
139,415 AMD
400,000 AMD
GALAXY RA
ABOUT THE COMPANY
GALAXY COMMUNITY IN NUMBERS
SOCIO-ECONOMIC IMPACT
ECONOMIC ACTIVITY IN NUMBERS
JOB PROFILE AND SALARY COMPARISON
16
Galaxy Group of Companies is one of the most in-demand organizations of highly qualified workforce in Armenia.
GALAXY GROUP OF COMANIES / 2021
Employee Distribution
Salary Comparison
67.6% IT and Communication 0.9% Construction 2.2% Consultation 1.6% Security 3.2% Service
7.4% Real estate management 7.5% Retail 9.6% Wholesale
2020
2019
Construction
150,758 AMD
152,434 AMD
Consultation
343,023 AMD
402,446 AMD
Wholesale
346,112 AMD
355,515 AMD
Service
116,547 AMD
94,061 AMD
IT and Communication
394,242 AMD
431,121 AMD
Real Estate Management
341,277 AMD
364,234 AMD
Retail
325,181 AMD
207,791 AMD
Security
163,828 AMD
131,963 AMD
0
ABOUT THE COMPANY
GALAXY COMMUNITY IN NUMBERS
250,000 AMD 500,000 AMD
SOCIO-ECONOMIC IMPACT
ECONOMIC ACTIVITY IN NUMBERS
GALAXY GROUP OF COMANIES / 2021
17
ECONOMIC ACTIVITY IN NUMBERS Taxes, loans, GDP impact
ABOUT THE COMPANY
GALAXY COMMUNITY IN NUMBERS
SOCIO-ECONOMIC IMPACT
ECONOMIC ACTIVITY IN NUMBERS
TAXES PAID IN 2020
18
Taxes paid by Galaxy Group 2018
2019
Taxes paid in the RA 2020
$ 32 mln
GALAXY GROUP OF COMANIES / 2021
$ 30 mln $ 28 mln $ 26 mln
2018
2019
2020
$ 2,723,016,664
$ 3,097,073,179
$ 2,989,249,617
$ 3.2 bln
$ 24 mln
$ 3.1 bln
$ 22 mln
$ 3.0 bln $ 2.9 bln
$ 20 mln
$ 2.8 bln $ 18 mln
$ 2.7 bln
$ 16 mln
$ 2.6 bln
$ 14 mln
$ 2.5 bln
$ 27,723,056
$ 31,210,558
$ 22,238,602
GALAXY
RA
ABOUT THE COMPANY
GALAXY COMMUNITY IN NUMBERS
SOCIO-ECONOMIC IMPACT
ECONOMIC ACTIVITY IN NUMBERS
ACQUISITIONS FROM LOCAL MARKET IN 2020
19
Acquisitions made by Galaxy Group from the local market amounted to ≈ USD 36 million in 2020.
GALAXY GROUP OF COMANIES / 2021
2020
Allocations to travel agencies
$
Services
$ 2,497,270
$ 2,882,771
Fixed assets
$ 9,438,962
$ 9,093,117
Talent development
$
183,496
$
554,100
Office goods & supplies
$
568,540
$
731,889
Transport
$
600,118
$
987,965
Banking and payment
$ 1,828,134
$ 1,395,623
Rent
$ 1,595,632
$ 6,408,999
Bills
$ 3,613,593
$ 4,456,311
Marketing
$ 1,390,186
$ 2,712,790
Commercial
$ 13,094,492
$ 21,697,318
Other
$ 0
$ 5 mln
$ 7,5 mln
79,772
2019
$
467,707
981,981 $ 15 mln
ABOUT THE COMPANY
GALAXY COMMUNITY IN NUMBERS
SOCIO-ECONOMIC IMPACT
ECONOMIC ACTIVITY IN NUMBERS
IMPACT. FINANCES & BANKING IN 2020
20
Galaxy Group’s share in the total loans provided by Armenian banks amounted to 2019: 3.02%
GALAXY GROUP OF COMANIES / 2021
Galaxy Group loan statistics 2018
Loans provided by the banks **
2019
2020
$ 140 mln
2018
2019
2020
$ 3,865,600,665
$ 4,239,168,093
$ 4,625,812,960
$ 4.3 bln
$ 120 mln
$ 4.2 bln
$ 100 mln
$ 4.1 bln
$ 80 mln
$ 4.0 bln
$ 60 mln
$ 3.9 bln
$ 40 mln
$ 3.8 bln
$ 20 mln
$ 3.7 bln
$ 10 mln $
2020: 2.48%
$ 3.6 bln
0
$ 134,605,661
$ 6,327,440
Loans provided
$ 128,044,927
$ 10,505,007
$ 5,521,159
$ 114,927,237
$ 5,478,927
Bond *
Interest expense * Interest on bonds totaled
$ 6,161,255
2019: 207,000 USD
Total loans in RA ** Households & non for profit organizationloans excluded
2020: 379,000 USD
ABOUT THE COMPANY
GALAXY COMMUNITY IN NUMBERS
SOCIO-ECONOMIC IMPACT
ECONOMIC ACTIVITY IN NUMBERS
2021 SOCIAL & ECONOMIC IMPACT REPORT www.galaxygroup.am info@galaxygroup.am
© GALAXY GROUP OF COMPANIES. ALL RIGHTS RESERVED 2021