PEILCC Annual Report 2025

FOR THE YEAR ENDED MARCH 31, 2025 2025 ANNUAL REPORT PEI LIQUOR CONTROL COMMISSION

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CELEBRATE SPRING 2024 1

P.E.I. Liquor Control Commission 3 Garfield Street Charlottetown, PE C1A 6A4

PEILCC WHAT GUIDES US

CORPORATE VISION To be a leading retailer and regulator that exceeds all expectations.

MISSION STATEMENT To be a superior organization recognized for business excellence, exceptional customer service, commitment to corporate responsibility and progressive employment practices. The Prince Edward Island Liquor Control Commission’s strategic plan is based on four theme areas which serve as a blueprint for incorporating our mission statement into the day-to-day activities. STRATEGIC PILLARS Business Results: To be a key contributor to PEI’s general revenue through business excellence and continuous improvement in operational effectiveness and efficiency. Customer Experience: To achieve and maintain high levels of customer satisfaction through innovation, service excellence, and responsiveness to customer preferences in product selection. Corporate Social Responsibility: To encourage and monitor the responsible consumption of beverage alcohol in PEI through public engagement, internal campaigns, passionate employees, and fair regulation. People & Culture: To foster a high-performing, customer-focused culture of engaged employees through open communication, learning & development, safe work environments, and overall wellness. CORPORATE VALUES Moderation: We promote responsible use as a way of life. Quality Service: We take pride in the quality of our work. We strive for excellence in caring for our customers, suppliers and one another. Continuous Improvement: As a retailer, we welcome change. We are committed to continuous improvement to all of our services. Integrity and Fairness: We take responsibility and are fully accountable for our actions, decisions and behaviour. We meet our commitments and obligations to co workers, customers and business partners. We are open, honest and fair. Importance of People: We are committed to fostering a positive workplace that builds teamwork, mutual respect and encourages individual development. Focus on Results: We are committed to getting the job done and improving our productivity levels.

PLEASE DON’T DRINK & DRIVE

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PEILCC 2024-2025 Annual Report

KNOW WHAT’S IN YOUR GLASS

A STANDARD DRINK IS 13.5 GRAMS OF ALCOHOL.

BEER OR CIDER 341ml or 12oz (5% ABV)

WINE 142ml or 5oz (12% ABV)

SPIRITS 43ml or 1.5oz (40% ABV)

Understanding how much is in a standard single serving of alcohol helps you pace yourself and stay in control.

PLEASE DRINK RESPONSIBLY.

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PEILCC 2024-2025 Annual Report

TABLE OF CONTENTS

PEILCC - What Guides Us

1

Table Of Contents

3 4 4 5 6 7 7 7 7 7 9

Message from the Minister Message from the Chair Message from the CEO Corporate Governance

Mandate of the PEI Liquor Control Commission Board Accountability to Government and the Public

Appointment of Board Members Responsibilities of Board Members

PLAN A SAFE RIDE HOME

Audit Committee Organizational Chart Executive Summary

10

Sommaire

11

Operational Overview

12 12 16 18 24 25 25 25 26 26 27 28 30 33

Strategic Target - Business Results Strategic Target - Customer Experience

Strategic Target - Corporate Social Responsibility

Strategic Target - People & Culture

Statistics

Retail Gross Receipts by Store

PEI Liquor Retail Outlets

Summary of Profit and Expense Ratios – Two-Year Comparison

Our Spending... All Profits Stay Here Sales Volumes (litres) by Category

Total Licenses and Special Permits – March 31, 2024 and March 31, 2025

Featured Producer - Rossignol Estate Winery

Management’s Report

Appendix

Auditor’s Report and Audited Financial Statements

34

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PEILCC 2024-2025 Annual Report

MESSAGE FROM THE MINISTER

The Honourable Antoinette Perry Lieutenant Governor of Prince Edward Island 1 Terry Fox Drive Charlottetown, PE C1A 0E8

May It Please Your Honour:

Pursuant to the Liquor Control Act and as Minister designate, it is my privilege to submit the 77 TH Annual Report of the Prince Edward Island Liquor Control Commission.

Respectfully submitted,

Honourable Jill Burridge, Minister of Finance

MESSAGE FROM THE CHAIR

The Honourable Jill Burridge Minister of Finance 95 Rochford Street Charlottetown, PE C1A 3T5

Minister:

In compliance with Section 87(3) of the Liquor Control Act , it is my honour to submit this 77 TH Annual Report of the Prince Edward Island Liquor Control Commission covering the fiscal year April 1, 2024 to March 31, 2025.

Respectfully submitted,

John Abbott, Chair

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PEILCC 2024-2025 Annual Report

MESSAGE FROM THE CEO

Mr. John Abbott, Chair PEI Liquor Control Commission 3 Garfield Street Charlottetown, PE C1A 6A4

Dear Mr. Abbott,

It is my privilege to present the Prince Edward Island Liquor Control Commission’s (PEILCC) Annual Report for the fiscal year ending March 31, 2025. Once again, the work of our team has led to strong results for Islanders, with over $140 million in gross receipts and more than $48.4 million in returns to the provincial government. These funds continue to play a vital role in supporting essential services such as healthcare, education, and infrastructure across the Island.

This past year, our focus remained firmly on upholding our mandate under the Liquor Control Act and as laid out in the 2024 ministerial mandate letter, delivering strong returns to the province while promoting social responsibility. Our efforts to reduce impaired driving and encourage responsible consumption continued to expand, with new educational campaigns, strengthened community partnerships, and support for local organizations working to keep Island roads safe. We are proud to see more individuals and organizations joining us in creating a culture that prioritizes safety, health, and accountability. We also continued to enhance our retail network, investing in renovations and infrastructure upgrades that create more welcoming, accessible, and efficient environments for both customers and staff. New improvements at select locations reflect our commitment to modernizing our services while maintaining the high standards Islanders expect. Our team’s commitment to excellence was further supported by expanded training and development opportunities, ensuring that our staff remains knowledgeable, engaged, and prepared to meet evolving customer needs. At the heart of our success is the dedication of our people. I want to thank every member of the PEILCC team, from store employees and warehouse staff to head office personnel and our board of directors, for your hard work, professionalism, and pride in service. As we look to the year ahead, we are excited to continue innovating, evolving, and serving Islanders with integrity and responsibility. The PEILCC remains committed to building on our successes while adapting to the changing needs of our communities and the marketplace.

PLEASE DON’T DRINK & DRIVE

Thank you for your continued trust and support.

Warm regards,

Daniel MacDonald, Chief Executive Officer PEI Liquor Control Commission

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PEILCC 2024-2025 Annual Report

CORPORATE GOVERNANCE Corporate governance describes the process and structure for overseeing the direction and management of a crown corporation so that it effectively fulfills its mandate. This involves both its public policy and commercial objectives. It defines who is responsible for what, and how to ensure accomplishment and accountability.

PEI LIQUOR CONTROL COMMISSION BOARD Standing: Kate Shreenan - Recording Secretary, Ian Burge – Member, Ken Mill – Member

Seated: Daniel MacDonald - Chief Executive Officer, John Abbott - Chair, Nicole DesRoche – Vice Chair

Absent from Photo: Kelly Shea Rayner - Member, Murray Murphy - Commission Solicitor

EXECUTIVE MANAGEMENT TEAM Standing: Gerald O’Halloran - Director, Supply Chain & Property Management, Mark Carragher - Director, Marketing & Sales, Shawn Alexander - Director, Human Resources & Employee Wellness Seated: Daniel MacDonald - Chief Executive Officer, Linda Somers - Director, Corporate Affairs & Regulatory Services Absent from photo: Matthew McMillan - Acting Chief Financial Officer

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PEILCC 2024-2025 Annual Report

MANDATE OF THE PEI LIQUOR CONTROL COMMISSION BOARD The mandate of the board is to supervise the business affairs of the Commission. Its most important responsibilities are: • Ensuring that the PEILCC provides high-quality service to the public; • Developing and approving the strategic plan and monitoring management’s success in meeting the strategic plan; • Approving annual financial plans; • Assessing and managing business risk; and • Ensuring that the PEILCC performs its regulatory role in a fair and impartial manner. ACCOUNTABILITY TO GOVERNMENT AND PUBLIC • The Annual Report, tabled in the Provincial Legislature and available to review, either in print or online at www.liquorpei.com; • Annual audits of the PEILCC’s financial statements by a qualified auditor; • Public access to records under the Freedom of Information and Protection of Privacy Act ; and • Publicly appointed commission members. APPOINTMENT OF BOARD MEMBERS The Lieutenant Governor in Council, through an Order-in-Council, appoints the members of the PEILCC Board, establishes the honourariums, and designates the Chair and Vice-Chair. RESPONSIBILITIES OF BOARD MEMBERS • Acting honestly and in good faith in making decisions with a view to the best interests of the PEILCC and all its stakeholders; • Overseeing the management of the business affairs of the PEILCC; • Avoiding conflicts of interest; • Having adequate knowledge of the PEILCC’s business, how it is organized and how it functions; • Attending Board meetings and seeking professional advice where necessary; and • Providing guidance on policy development. AUDIT COMMITTEE The Audit Committee is elected annually and consists of three Board Members in addition to the Chair and the Executive Assistant as ex-officio. The committee ensures the reliability and accuracy of the PEILCC’s Financial Statements, helps co-ordinate and improve internal control functions, and ensures the PEILCC adheres to sound corporate governance principles. The PEILCC is held accountable by the Government and people of PEI in a number of ways, including: Each Board member has individual responsibility for corporate governance including:

PLAN A SAFE RIDE HOME

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PEILCC 2024-2025 Annual Report

ORGANIZATIONAL CHART * Shared-services agreement with PEI Cannabis Management Corporation (PEICMC) ** For the period starting May 14, 2024 *** For the period starting December 19, 2024

HON. JILL BURRIDGE

Minister of Finance

JOHN ABBOTT

Chair

**

NICOLE DESROCHE

IAN BURGE

Member Vice Chair

Member

PLEASE DON’T DRINK & DRIVE

**

***

KELLY SHEA RAYNER

KEN MILL

Member

Member

*

*

DANIEL MACDONALD

KATE SHREENAN

Chief Executive Officer

Executive Assistant

*

*

Director, Corporate Affairs and Regulatory Services

LINDA SOMERS

MATTHEW MCMILLAN

Acting Chief Financial Officer

*

*

Director, Human Resources and Employee Wellness

Director, Supply Chain and Property Management

SHAWN ALEXANDER

GERALD O’HALLORAN

Director, Retail Operations and Development

MARK CARRAGHER

Director, Marketing and Sales

VACANT

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PEILCC 2024-2025 Annual Report

EXECUTIVE SUMMARY The Prince Edward Island Liquor Control Commission (PEILCC) is a crown corporation responsible for the administration of the Liquor Control Act and Regulations, along with the purchase, control and sale of all beverage alcohol in the province. A five-member Board of Commissioners is responsible for the Commission’s activities. The Chair reports to the Minister responsible for the PEI Liquor Control Commission. The mandate under the Liquor Control Act has two primary components: regulatory and commercial. The regulatory function responsibilities include: • licensing and inspecting licensed premises and special permit events; • investigating and reporting on all licensee or special permit complaints and determining whether there were infractions of the Liquor Control Act ; and • making recommendations to government on amendments to legislation. The PEILCC continues to be a major contributor to the provincial economy with gross receipts in excess of $140 million. In addition, monetary transfers to the Provincial Treasury were $48.4 million. The Commission currently operates 18 corporate retail outlets, as well as a central warehouse and Licensee Distribution Centre located in Charlottetown. In addition, 12 Liquor Agency stores can be found in the following locations across the province: Bothwell, Cavendish, DeSable, East Royalty, Eldon, Kinkora, Morell, Murray Harbour, North Wiltshire, Oyster Bed Bridge, Wellington, and Wood Islands. A strategic plan is in place that guides the Commission to success in meeting its performance and accountability goals.

The Commission focuses on the following four key areas to measure performance:

1. Business Results; 2. Customer Experience; 3. Corporate Social Responsibility; and 4. People and Culture.

These areas serve as a blueprint for incorporating the Mission Statement into day-to-day activities and establishing strategic goals, the details of which are explained in further detail in this report.

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PEILCC 2024-2025 Annual Report

SOMMAIRE La Régie des alcools de l’Île-du-Prince-Édouard est une société de la Couronne responsable de l’administration de la Liquor Control Act (loi sur les alcools) et de ses règlements, ainsi que de l’achat, du contrôle et de la vente de toutes les boissons alcoolisées dans la province. Un conseil composé de cinq commissaires est responsable des activités de la Régie. La présidence fait rapport à la ministre responsable de la Régie des alcools de l’Île-du-Prince-Édouard. Le mandat donné par la Liquor Control Act compte deux principaux volets – l’un, réglementaire et l’autre, commercial. Les responsabilités du volet de réglementation comprennent : • octroyer des licences et inspecter les débits de boisson et les événements rattachés aux permis spéciaux; • enquêter et faire rapport sur les plaintes liées aux détenteurs de permis et aux permis spéciaux ainsi que déterminer s’il y a eu infraction à la Liquor Control Act ; • faire des recommandations au gouvernement sur la modification des lois. Du côté commercial, la Régie continue d’être un levier important de l’économie de la province, ses recettes brutes dépassant les 140 millions de dollars. Sur le plan des transferts monétaires au Trésor provincial, un total de 48,4 millions de dollars a été versé à la province. À l’heure actuelle, la Régie exploite dix-huit (18) points de vente au détail ainsi qu’un entrepôt central et un centre de distribution pour les détenteurs de permis situés à Charlottetown. Douze (12) magasins de franchise sont répartis dans les communautés suivantes : Bothwell, Cavendish, DeSable, East Royalty, Eldon, Kinkora, Morell, Murray Harbour, North Wiltshire, Oyster Bed Bridge, Wellington et Wood Islands.

PLAN A SAFE RIDE HOME

La Régie utilise un plan stratégique pour atteindre ses objectifs de performance et de responsabilité.

Elle concentre ses efforts sur quatre domaines principaux afin de mesurer sa performance :

1. Résultats opérationnels 2. Expérience client 3. Responsabilité sociale 4. Personnes et culture

Ces domaines servent de plan directeur à l’intégration de notre mission dans nos activités quotidiennes et à l’établissement d’objectifs stratégiques qui seront expliqués plus en détail plus loin dans ce rapport.

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PEILCC 2024-2025 Annual Report

OPERATIONAL OVERVIEW The Prince Edward Island Liquor Control Commission’s Strategic Plan continued to guide activities through fiscal 2024-2025. Progress on strategic objectives is supported by annual business plans that set priorities for actions to meet objectives and timelines for their completion. The following is an overview of the performance in each of the four strategic objectives:

STRATEGIC TARGET • BUSINESS RESULTS

STRATEGIC TARGET To maximize net income within the policy guidelines established by the provincial government.

CORPORATE OBJECTIVES 1. Optimize return to government. 2. Grow revenue through effective planning and execution. 3. Continuously improve operational effectiveness and efficiency.

PERFORMANCE MEASURES

Actual 2023-2024

Target 2024-2025

Actual 2024-2025

% of Target 2024-2025

Target 2025-2026

Gross Receipts

$140,325,106

$142,323,000

$140,059,061

98.41%

$146,100,000

Gross Profit

$39,766,128

$40,292,300

$40,343,225

100.13%

$41,054,000

Operating Expenses

$19,073,915

$21,517,800

$20,263,669

94.17%

$21,770,000

Net Income

$24,196,320

$21,924,500

$23,540,576

107.37%

$22,659,000

Return To Government*

$48,780,067

$46,873,500

$48,481,000

103.43%

$48,270,400

Revenue Per Litre

$9.99

$10.41

$10.10

97.02%

$10.42

Spirits

$43.00

$44.10

$43.22

98.00%

$44.52

Beer (including draught)

$5.81

$6.14

$5.91

96.25%

$6.09

Wine

$18.82

$19.69

$19.15

97.26%

$19.72

Wine Coolers

$11.17

$11.20

$12.18

108.75%

$12.54

Spirit Coolers

$7.40

$7.37

$7.46

101.22%

$7.68

Operating Expenses as a % of Gross Receipts

13.59%

15.12%

14.47%

95.69%

14.90%

Shrinkage as a % of Gross Receipts

0.00%

0.01%

0.01%

100%

0.01%

Inventory Turnover**

Warehouse

62.7

70.0

61.6

N/A

70.0

Stores

28.2

30.0

28.2

N/A

30.0

* Inclusive of Net Income and health tax transfers to government ** Measured in days

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PEILCC 2024-2025 Annual Report

PERFORMANCE HIGHLIGHTS

The industry continued to face many hurdles in Fiscal 2025, shifting spending habits, new social trends, and rising input costs. These factors all contributed to declining volumes and were a common trend across the country. Despite these challenges, The PEI Liquor Commission surpassed March 31, 2025, targets. Net transfers were +$1.61M, representing positive variances to budget of 3.4% respectively. The PEILCC has been better able to manage the days in inventory at the Warehouse level in order to meet the demands of our customers. Store inventory turns have remained stable compared to last year despite increasing the number of products held in store inventory to better serve customer demands. An improved store ordering process continues to keep store inventories in check and ensured better distribution and availability of inventory across the retail network. In addition, the central warehouse has been reconfigured to optimize space and manage warehouse efficiency.

PLEASE DON’T DRINK & DRIVE

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PEILCC 2024-2025 Annual Report

PERFORMANCE HIGHLIGHTS

Figure A Sources of Gross Receipts

Beer Other Merchandising Coolers Wine Spirits

25.2%

36.0%

Fiscal Year 2025

22.8%

2.8%

0.1%

13.1%

Figure B Application of Gross Receipts

Suppliers Federal Taxes Administrative Expenses Payments to Province

33.8%

40.0%

Fiscal Year 2025

12.1%

14.1%

The Commission spent approximately $57.5 million on alcohol from both domestic and international sources. Gross margins remained stable over the prior year period.

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PEILCC 2024-2025 Annual Report

PLAN A SAFE RIDE HOME

TRENT DEROCHE

Trent was raised in a vibrant fishing and farming community along Prince Edward Island’s picturesque south shore, where a love of food was central to his family life. With a strong commitment to giving back, Trent is a dedicated community volunteer who brings his passion for helping others to his role as a Product Advisor. After earning his Level Three Certification from the prestigious Wine & Spirit Education Trust (WSET), Trent developed a deep appreciation for exploring Europe’s iconic wine regions. From the Rieslings of Germany’s Mosel Valley to the bold reds of France’s Rhône Valley, he has found the combination of locally inspired cuisine and regionally produced wines to be a truly unmatched experience. Whether you’re curating that perfect cocktail recipe or searching for the ideal pairing to elevate a meal, Trent is eager to help.

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PEILCC 2024-2025 Annual Report

STRATEGIC TARGET • CUSTOMER EXPERIENCE

STRATEGIC TARGET To understand the needs of our customers so that we can provide quality products and services that are delivered by knowledgeable, courteous employees in attractive and accessible facilities.

CORPORATE OBJECTIVES 1. Enhance the shopping experience for PEILCC retail and licensee customers. 2. Provide enhanced customer services. 3. Improve product portfolio.

Actual 2023-2024

Target 2024-2025

Actual 2024-2025

% of Target 2024-2025

Target 2025-2026

PERFORMANCE MEASURES

Customers served Average customer transaction value

2,521,517

2,535,600

2,506,118

98.84%

2,500,000

$55.65

$56.13

$55.89

99.57%

$58.44

Actual 2023-2024

Target 2024-2025

Actual 2024-2025

% of Target 2024-2025

Target 2025-2026

Litres

Beer (including draught)

8,995,490

8,590,700

8,774,077

102.13%

8,840,100

Spirits

859,151

840,300

840,901

100.07%

852,700

Wine (including BYO)

1,749,143

1,670,400

1,714,400

102.63%

1,737,800

Refreshments

2,441,562

2,490,400

2,531,358

101.64%

2,590,700

Total

14,045,346

13,591,800

13,860,736

101.98%

14,021,300

PERFORMANCE HIGHLIGHTS

Overall beer decreased by 2.5%, with dollar sales up 0.5%. The beer category continues to see a decline in traditional domestic lagers, however there has been a shift towards craft and premium imported products. Many beer consumers continue to shift towards the Ready to Drink (RTD) category. Spirits decreased by 2.1% in volume, with dollar sales flat versus previous years. Our overall spirits category aligned with regional and national trends. Growth within this category continues to be led primarily by tequila with an 8% increase in volume and a 12% increase in dollar sales. Ready to Drink volume increased by 3.7%, dollar sales increased by 5.9%. This growth is attributed to factors such as the Island’s tourism industry, a younger demographic seeking variety, and the appeal of locally produced options for consumers. RTD sales continue to grow driven by consumer demand for pre-mixed, flavorful, and lower-calorie alcoholic options. In particular, popularity in vodka-based seltzers and canned cocktails is rising due to their convenience and alignment with consumer trends.

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PEILCC 2024-2025 Annual Report

Volume in the wine category decreased by 3%, with dollar sales flat versus Fiscal 24. This is despite a double-digit decline in US wines (-13% volume, -9% in dollars), our #3 Country in overall sales. Prior to the U.S. wines being pulled from shelves (March 2, 2025), it was trending down -8% in volume and -4% in dollars. Chile (2% in volume, 8% in dollars) and France (9% in volume, 15% in dollars) lead the way in growth in this category for us. South Africa (-12% in volume, -3% in dollars) and Germany (-12% in volume, -7% in dollars) struggle versus previous and continue to trend down. Innovation in the category on Low/No alcohol wines, lower sugar has shown growth. Our commitment to improving customer experience continued in the past year with 91 employees choosing to participate in advanced training in the WSET program (Level 1, 2, and 3). This training program provides employees with an additional level of expertise which is beneficial when assisting customers.

PLEASE DON’T DRINK & DRIVE

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PEILCC 2024-2025 Annual Report

STRATEGIC TARGET • CORPORATE SOCIAL RESPONSIBILITY

STRATEGIC TARGET In partnership with community groups and suppliers, the PEILCC will strive to raise public and staff awareness of the responsible use of beverage alcohol. CORPORATE OBJECTIVES 1. Enhance our reputation as a socially responsible corporate citizen. 2. Build corporate social responsibility into all areas of our business. 3. Regulate the consumption of beverage alcohol throughout the province in a fair and responsible fashion.

Actual 2023-2024

Target 2024-2025

Actual 2024-2025

% of Target 2024-2025

Target 2025-2026

PERFORMANCE MEASURES

Number of ID Checks as a % of transactions

10.74% 10.0% 9.77% 97.7% 10.0%

Licensee Compliance Rate

99.6%

95%

98.7% 103.9% 95%

Number of Inspections Conducted

3,267

3,100

3,539

114.2% 3,200

% of Sanctions without Adjudication

99%

100% 96.8% 96.8% 100%

PERFORMANCE HIGHLIGHTS In 2024, the PEILCC was mandated to develop a plan to allocate 3% of the combined net profits of PEILCC and PEICMC towards social responsibility initiatives, beginning in the 2024-2025 fiscal year. This commitment resulted in contributions of $600,092 from the PEILCC and $213,666 from the PEICMC, for a total of $813,758. Through this funding, the PEILCC partnered with the PEI Community Fund to provide $150,000 in grant support aimed at promoting healthy behaviors related to alcohol consumption and reducing potential alcohol-related harms. Additionally, $150,000 was provided to the Department of Health to evaluate the effectiveness of current social responsibility spending on influencing liquor consumption behaviors and to make recommendations for improving the impact of these initiatives. The PEILCC also made donations to a range of important community efforts, including MADD Canada, social responsibility radio campaigns, safe ride programs, UPEI, and Holland College. The PEI Liquor Control Commission continues to promote the responsible use of alcohol by offering products that are socially responsible and incorporating responsible messaging into product promotions. Ongoing responsible use activities include: ID Training for PEILCC corporate retail and liquor agency staff and the Check 30 ID Program. A variety of targeted responsible use messaging was promoted throughout the year, using local media outlets and social media platforms, as well as signage at various events and in select areas across the province. The Prince Edward Island Liquor Control Commission continues its support of MADD Canada’s Multi-media School Assembly Program during the 2024-2025 school year. This year saw thirty one presentations of a new 45 minute short film, One Last Dance/ Une Dernière Danse, presented in both English and French in twenty nine schools across the province. The Commission continues to support the efforts of MADD Canada through the Campaign 911 and the in-store retail ice program available in a number of corporate retail outlets. The Commission continued to promote safe rides featuring ride share provider KARI. This year promotional discounts were available during the holiday season as well as the annual PEI Spirits Festival and PEI Wine Festival.

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PEILCC 2024-2025 Annual Report

PLAN A SAFE RIDE HOME

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PEILCC 2024-2025 Annual Report

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PEILCC 2024-2025 Annual Report

PLEASE DON’T DRINK & DRIVE

The PEI Liquor Control Commission continues to partner with both the University of Prince Edward Island (UPEI) and Holland College for each institution’s KEEP IT SOCIAL (KIS) programing. KIS helps students make responsible decisions when it comes to alcohol. Led by students and sponsored by the PEILCC, Keep It Social is a long-term initiative designed to address and reduce high-risk consumption. Now in its seventh year, KIS tackles the false perceptions that many students have about how much alcohol their peers consume. By getting the message out on campuses, keepitsocial.ca offers students tips and advice on how to make the right decisions when they’re planning a night out. UPEI and Holland College appoint several student athletes as KEEP IT SOCIAL Ambassadors who act as leads to spread the message about the impacts of high-risk alcohol consumption among students. The KIS message is promoted through social media and KIS videos that are shown and promoted throughout the academic year at various athletic and social events. In partnership with UPEI, Coach Atlantic, and DALMAC, a PEILCC funded bus wrap puts a focus on the campaign when student athletes travel throughout the Maritime Provinces.

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PEILCC 2024-2025 Annual Report

CHARITY OF THE MONTH

The PEI Liquor Control Commission (PEILCC) presented donations to several charitable organizations as part of its new Charity of the Month Campaign where the PEILCC would donate to different organizations each month. Funds for this initiative are raised through in store cash round up’s at check out, along with monthly casual day donations contributed by our head office and retail teams, helping to increase the support provided to each organization. This initiative was very successful in its first year generating over $570,330 in total donations. PEILCC is committed to the communities it serves, and this campaign gives back to organizations that provide important support and assistance to Islanders.

FULL LIST OF CHARITIES:

• Canadian Mental Health Association of PEI • Santa’s Angels • Island Food Banks • Special Olympics of PEI • PEI Cancer Treatment Centre (via QEH Foundation) • PEI Humane Society

• Diabetes Canada • ALS Society of PEI • Make a Wish Foundation Canada • Island Shelters • QEH/PCH/IWK Foundations • Alzheimer’s Society of PEI

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PEILCC 2024-2025 Annual Report

STRATEGIC TARGET • PEOPLE & CULTURE STRATEGIC TARGET Build a customer-focused, high-performance work environment that results in greater employee involvement, development, innovation and creativity. CORPORATE OBJECTIVES 1. Always recruit, retain, and develop the best people. 2. Foster a culture of performance, communication, and engagement. 3. Rigorously establish and promote a healthy, safe, and respectful workplace.

Actual 2023-2024

Target 2024-2025

Actual 2024-2025

Target % 2024-2025

Target 2025-2026

PERFORMANCE MEASURES Training Hours per Employee - FTE

20.34

10

24.15

241.5%

10

EMPLOYEE EXCELLENCE Plan

67.76%

90%

68.49%

76.1%

90%

Employee Wellness Rate

97.94%

98%

97.65%

99.6%

98%

Lost-Time Frequency

4.70

8

5.11

63.9%

8

PERFORMANCE HIGHLIGHTS

The PEILCC continued to re-invest in its employees training and development by providing them with a range of developmental opportunities over fiscal 2025. The PEILCC training hours per employee were up significantly from 20.34 hours in fiscal 2024 to 24.15 hours for fiscal 2025. This is partly a result of an emphasis on product knowledge courses facilitated through the PEILCC. More employees are also utilizing the PEI Public Service Commission’s training opportunities and offerings. We continue to offer Wine and Spirit Education Trust (WSET) training and the PEILCC Development & Training Fund continues to be utilized by staff along with the Union of Public Sector Employee and Public Service Commission Development & Training Fund. These funds are allocated to developmental opportunities that assist employees in achieving their personal career objectives, while simultaneously bridging individual performance gaps that collectively lead to increased levels of organizational success. The PEILCC had continued success in fostering high levels of workplace wellness and safety over fiscal 2025. Efforts in employee engagement and the provision of OH&S training, disability management initiatives appear to have led to a decrease in workplace accidents leading to lost time. The release of the new Respectful Workplaces policy has included information sessions for staff as well highlighting the importance of workplace respect and the importance of reporting issues and concerns. A healthy workforce is extremely important to the PEILCC, particularly given the physically demanding work involved in many operational processes. Continued effort in this regard will be an ongoing priority moving forward.

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PEILCC 2024-2025 Annual Report

STATISTICS Retail Gross Receipts by Store

Year Ended March 31, 2025

Year Ended March 31, 2024

Year Ended March 31, 2023

Retail Store

Gross Sales

Licensee

$26,680,544

$27,020,600

$24,349,029

Oaktree

$16,745,763

$17,196,412

$17,551,913

West Royalty

$15,657,582

$15,567,560

$16,847,858

Stratford

$11,512,727

$11,692,178

$11,637,162

Granville

$11,508,222

$11,316,549

$11,243,305

PLAN A SAFE RIDE HOME

Montague

$8,513,684

$8,673,363

$8,753,955

Cornwall

$6,829,893

$6,891,552

$7,392,444

Waterfront

$5,619,944

$4,990,274

$5,136,210

Kensington

$4,953,279

$5,007,526

$5,095,037

North Rustico

$4,269,901

$4,208,041

$4,610,954

Queen Street

$4,113,376

$4,382,439

$4,829,740

Tignish

$3,809,250

$3,798,295

$3,579,926

Souris

$3,507,390

$3,525,669

$3,884,011

O'Leary

$3,055,862

$3,072,094

$3,115,897

Cardigan

$2,612,173

$2,526,325

$2,454,695

Alberton

$2,557,522

$2,579,509

$2,535,119

Gateway

$2,436,490

$2,421,561

$2,544,212

Notables

$2,051,257

$1,844,881

$1,967,341

Tyne Valley

$1,641,307

$1,648,366

$1,633,154

Other Revenue Streams

$1,982,896

$1,961,912

$1,887,176

Total

$140,059,061

$140,325,106

$141,049,138

PEI Liquor Retail Outlets

CORPORATE RETAIL STORES

LIQUOR AGENCY STORES

Alberton Borden-Carleton - Gateway Cardigan Charlottetown - Notables Charlottetown - Oaktree Charlottetown - Queen Street Charlottetown - West Royalty Cornwall Kensington

Montague North Rustico O’Leary Souris Stratford

Bothwell Cavendish DeSable East Royalty Eldon Kinkora Morell

Summerside - Granville Summerside - Waterfront Tignish Tyne Valley

Murray Harbour North Wiltshire Oyster Bed Bridge Wood Islands Wellington

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PEILCC 2024-2025 Annual Report

STATISTICS Summary of Profit and Expense Ratios • Two-year Comparison

(in 000s)

2025

2024

Gross Receipts

140,059

140,325

Gross Profit

40,343

39,766

Net Income

23,541

24,196

General and Administrative Expenses

20,264

19,074

Gross Profit as a Percentage of Gross Receipts

28.80%

28.34%

Net Profit as a Percentage of Gross Receipts

16.81%

17.24%

General and Administrative Expenses as a Percentage of Gross Receipts

14.47%

13.59%

OUR SPENDING (IN 000’S) All Profits Stay Here

4.8%

9.3%

Operating Costs:

Salaries and Benefits:

6,891

13,372

143,520

Total Sales:

(Including other income)

48,481

57,466

33.7%

40.0%

Returned to PEI:

Cost of Product:

17,309

12.1%

HST & Other:

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PEILCC 2024-2025 Annual Report

SALES VOLUMES (litres) by Category

6

0

63.3%

8

,

,

7

3

1

3

Beer 8,774,077

:

5

L

A

6.1%

T O T

Spirits 840,901

Fiscal Year 2025

PLEASE DON’T DRINK & DRIVE

12.4%

Wine 1,714,400

18.2%

Coolers 2,531,358

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PEILCC 2024-2025 Annual Report

Total Licenses and Special Permits

Year Ended March 31, 2025

Year Ended March 31, 2024

License Type

Brew Pub

17

18

Caterer

24

23

Club

36

38

Dining Room

197

190

Distillery

10

11

Ferment on Premises

5

5

Liquor Agency

12

12

Lounge

115

108

Micro-Brewery

12

12

Military Canteen

21

20

Package Sales

102

103

Special Premise

168

160

Tourist Home

7

7

Winery

8

8

Total Licenses in Effect

734

715

Special Permits Issued

Year Ended March 31, 2025 Year Ended March 31, 2024

Class I

111

120

Class II

87

75

Total

198

195

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PEILCC 2024-2025 Annual Report

PLAN A SAFE RIDE HOME

ROSSIGNOL ESTATE WINERY

The idea for Rossignol Estate Winery was born when my wife and I sailed from Ontario to PEI aboard our 40-foot, home-built ketch, Nightingale. We came across a cleared, sloping 20-acre potato field in Little Sands with perfect southern exposure and began building in 1990. Our first priority was the essentials: a house, barn, and workshop, which took about three years to complete. During that time, I started making wine as a hobby. scene to speak of, a result of long-standing prohibition-era regulations. After several years of conversations with the Department of Agriculture and the Liquor Control Commission, I finally got the call. It was Gilbert Clements, phoning on the last day of the House sitting in 1994, to say we were approved for a winery license. Construction on the winery began right away. It quickly became clear that while PEI had a tobacco industry, there was no wine

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PEILCC 2024-2025 Annual Report

PLEASE DON’T DRINK & DRIVE

My vision from the start was to create a traditional, old-world-style winery, working with local fruit to craft wines that capture the flavours and character of PEI. By 1995, our wines were on the shelves at PEILCC stores and available in our tasting room, and 30 years later, that’s still what we do. The process of making wine from berries like blueberries or strawberries is much the same as it is for traditional red and white grapes. This flexibility allows us to experiment. When a farmer calls to ask if I’ll try black currants, we can create a lovely cassis, just like in France. Food and wine naturally go together, and I have a few favourite pairings. Our L’Acadie Blanc is perfect with fresh PEI lobster. For Indian curry nights, our Wild Blueberry wine is a great match. Cranberry wine makes a fine aperitif on the deck, and after a long, hot day of cycling, I like to cool off with a simple Strawberry Spritzer made with our Rossignol Strawberry Rhubarb and soda water.

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PEILCC 2024-2025 Annual Report

MANAGEMENT’S REPORT Mr. John Abbott, Chair PEI Liquor Control Commission 3 Garfield Street Charlottetown, PE C1A 6A4

Dear Mr. Abbott:

The preparation of financial information is an integral part of the PEILCC’s senior management’s responsibilities, including the accompanying Financial Statements. This responsibility includes the selection of appropriate accounting policies and making judgments and estimates consistent with International Financial Reporting Standards.

The Commission maintains an accounting system and related controls providing:

PLAN A SAFE RIDE HOME

• Reasonable assurance that transactions are executed and recorded as authorized; • That assets are properly safeguarded and accounted for; and • That financial records are reliable for the preparation of Financial Statements in accordance with International Financial Reporting Standards. Financial information presented elsewhere in this annual report is consistent with that in the Financial Statements.

Respectfully submitted,

Daniel MacDonald, Chief Executive Officer

Matthew McMillan,

Acting Chief Financial Officer

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PEILCC 2024-2025 Annual Report

INDEPENDENT AUDITOR'S REPORT

To the Commissioners of Prince Edward Island Liquor Control Commission Opinion

We have audited the financial statements of Prince Edward Island Liquor Control Commission (the Commission), which comprise the statement of financial position as at March 31, 2025, and the statements of changes in equity, profit or loss and cash flow for the year then ended, and notes and schedules to the financial statements, including a summary of significant accounting policies. In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Commission as at March 31, 2025, and the financial performance and cash flow for the year then ended in accordance with International Financial Reporting Standards. Basis for Opinion We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Commission in accordance with ethical requirements that are relevant to our audit of the financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Responsibilities of Management and Those Charged with Governance for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with International Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is responsible for assessing the Commission's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Commission or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing the Commission's financial reporting process. Auditor's Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. (continues)

1

34

PEILCC 2024-2025 Annual Report

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: � Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. � Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Commission’s internal control. � Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. � Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Commission’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Commission to cease to continue as a going concern. � Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. � Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Commission’s internal control. � Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. � Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Commission’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Commission to cease to continue as a going concern. Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. MRSB CHARTERED PROFESSIONAL ACCOUNTANTS INC. Charlottetown, PE June 27, 2025 As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: � Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

PLEASE DON’T DRINK & DRIVE

MRSB CHARTERED PROFESSIONAL ACCOUNTANTS INC.

Charlottetown, PE June 27, 2025

2

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PEILCC 2024-2025 Annual Report