PEILCC Annual Report 2025-2026

PEI LIQUOR CONTROL COMMISSION 2026 ANNUAL REPORT FOR THE YEAR ENDED MARCH 31, 2026

Scan the QR Code to look inside our 2025 PEI Liquor Fresh New Flavours Flyer

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 engage 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 coworkers, 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.

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Know what’s in your glass A STANDARD DRINK IS 13.5 GRAMS OF ALCOHOL

SPIRITS 43ml or 1.5oz (40% ABV)

WINE 142ml or 5oz (12% ABV)

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

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

Please drink responsibly.

TABLE OF CONTENTS

1 3 4 4 5 6

PEILCC What Guides Us Table Of Contents 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

7 7 7 7 7 9 10 11 12 12 16 18

• Appointment of Board Members • Responsibilities of Board Members • Audit Committee

• Organizational Chart • Executive Summary • Sommaire

Operational Overview

• 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, 2025 and March 31, 2026 Featured Producer - Holy Whale Brewing Co. Management’s Report Appendix • Auditor’s Report and Audited Financial Statements

24 25 25 25 26 26 27 28 30 33 34 34

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MESSAGE FROM THE MINISTER

The Honourable Dr. Wassim Salamoun 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 78th Annual Report of the Prince Edward Island Liquor Control Commission.

Respectfully submitted,

Honourable Jill Burridge, Minister of Finance and Affordability

MESSAGE FROM THE CHAIR

The Honourable Jill Burridge Minister of Finance and Affordability 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 78th Annual Report of the Prince Edward Island Liquor Control Commission covering the fiscal year April 1, 2025 to March 31, 2026.

Respectfully submitted,

John Abbott, Chair

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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 pleasure to present the Prince Edward Island Liquor Control Commission's Annual Report for the fiscal year ending March 31, 2026. Over the past year, the PEILCC continued to deliver strong financial results while remaining focused on our responsibility to serve Islanders with integrity, accountability, and care. We generated more than $144M in gross receipts and returned $46.6M to the Province of Prince Edward Island, providing meaningful support for the public programs and services that Islanders rely on every day.

As the retail landscape continues to evolve, our organization remains committed to balancing operational excellence with our mandate to promote the responsible sale and consumption of beverage alcohol. Throughout the year, we strengthened our retail operations by improving the customer experience, enhancing product selection, and investing in initiatives that increase efficiency across our stores and distribution network. These efforts position us to meet changing consumer expectations while continuing to provide exceptional service. Social responsibility continues to be at the heart of everything we do. Through ongoing partnerships, education initiatives, and community engagement, we continued to promote responsible consumption and support programs that help reduce alcohol-related harm. We recognize that our success is measured not only by financial performance, but also by the positive impact we have on the health and well-being of our communities. We also continued to invest in our people. The dedication, professionalism, and expertise of our employees remain the foundation of our success. By providing opportunities for learning, development, and workplace improvement, we are building a strong organization that is well-equipped to meet future opportunities and challenges. As we look ahead, we remain committed to innovation, responsible stewardship, and delivering value for Islanders. We will continue to strengthen our operations, embrace opportunities for improvement, and ensure the PEILCC remains a trusted public organization that serves the province with excellence. I would like to extend my sincere appreciation to our employees, Board of Directors, retail partners, suppliers, and all those who contribute to the success of the PEILCC. Your commitment and collaboration make our achievements possible.

Thank you for your continued confidence and support.

Warm regards,

Daniel MacDonald, Chief Executive Officer PEI Liquor Control Commission

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CORPORATE GOVERNANCE Corporate governance describes the process and structure for overseeing the direction and manage ment 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: Ken Mill (Member), Kelly Shea Rayner (Member), Kate Shreenan (Recording Secretary), Brian MacPhee (Member) Seated: Daniel MacDonald (Chief Executive Officer), John Abbott (Chair), Ian Burge (Vice Chair) Absent from Photo: Murray Murphy (Commission Solicitor) EXECUTIVE MANAGEMENT TEAM

Standing: Mark Carragher (Director, Marketing & Sales), Stanton Clements (Director, Retail Operations & Development), Aaron Lawlor (Chief Financial Officer), Gerald O’Halloran (Director, Supply Chain & Property Management) Seated: Kate Shreenan (Corporate Operations Manager), Daniel MacDonald (Chief Executive Officer), Linda Somers (Director, Corporate Affairs & Regulatory Services)

Absent from Photo: Kim Nickerson (Director, Human Resources & Employee Wellness)

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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 PEILCC is held accountable by the Government and people of PEI in a number of ways, including:

• 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 Each Board member has individual responsibility for corporate governance including:

• 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 consists of three Board Members and the Corporate Operations Manager 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.

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ORGANIZATIONAL CHART

* Shared-services agreement with PEI Cannabis Management Corporation (PEICMC) ** For the period starting Dec 16, 2025

Minister of Finance and Affordability

Hon. Jill Burridge

John Abbott

Chair

Brian MacPhee

Ian Burge

Vice Chair**

Member**

Kelly Shea Rayner

Ken Mill

Member

Member

Daniel MacDonald

Chief Executive Officer*

Kate Shreenan

Corporate Operations Manager*

Aaron Lawlor Chief Financial Officer*

Mark Carragher Director, Marketing & Sales

Gerald O'Halloran Director, Supply Chain and Property Management*

Kim Nickerson Director, Human Resources and Employee Wellness*

Linda Somers Director,

Stanton Clements Director,

Corporate Affairs & Regulatory Services*

Retail Operations and Development

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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. • 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 $144.5 million. In addition, monetary transfers to the Provincial Treasury were $46.5 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 mandate under the Liquor Control Act has two primary components: regulatory and commercial. The regulatory function responsibilities include:

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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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 Du côté commercial, la Régie continue d’être un levier important de l’économie de la province, ses recettes brutes dépassant les 144 millions de dollars. Sur le plan des transferts monétaires au Trésor provincial, un total de 46,5 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. 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 : 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.

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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OPERATIONAL OVERVIEW The Prince Edward Island Liquor Control Commission’s Strategic Plan continued to guide activities through fiscal 2025-2026. 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 Gross Receipts Gross Profit Operating Expenses Net Income Return To Government* Revenue Per Litre Spirits Beer (including draught)

% of Target 2025 - 2026

Actual 2024 - 2025 $140,059,061 $40,343,225 $20,263,669 $23,540,576

Target 2025 - 2026 $146,100,000 $41,054,000 $21,770,000 $22,659,000

Target 2026 - 2027 $150,484,000 $41,646,400 $23,802,100 $21,243,900

Actual 2025 - 2026 $144,560,507 $40,355,347 $22,412,648 $21,359,517

98.95% 98.30% 102.95% 94.27%

$48,270,400

96.49%

$48,481,000

$47,503,400

$46,577,495

$10.42 $44.52

100.38% 99.96%

$10.10 $43.22

$10.75 $45.79

$10.46 $44.50

$6.09

100.82%

$5.91

$6.31

$6.14

$19.72 $12.54 $7.68

100.66% 110.45% 101.95%

Wine Wine Coolers Spirit Coolers

$19.15 $12.18 $7.46

$20.43 $14.25 $8.06

$19.85 $13.85 $7.83

Operating Expenses as a % of Gross Receipts

14.90%

104.05%

14.47%

15.82%

15.50%

Shrinkage as a % of Gross Receipts

0.01%

100%

0.01%

0.01%

0.01%

Inventory Turnover**

70.0 30.0

N/A N/A

61.6 28.2

70.0 30.0

57.0 28.4

Warehouse Stores

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

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PERFORMANCE HIGHLIGHTS Fiscal 2026 presented a challenging operating environment for the industry, shaped by evolving consumer spending habits, emerging social trends, and rising input costs. These pressures contributed to lower sales volumes across the country. Despite these headwinds, the PEILCC delivered another year of strong financial performance and continued growth. Gross receipts reached $144.6 million, representing a 3.2% increase of approximately $4.5 million over 2024-2025 and achieving 98.95% of the annual target of $146.1 million. Returns to Government totaled $46.6 million, reflecting a substantial contribution to the Province and achieving 96.49% of target. While results were modestly below forecast, the PEILCC's overall performance demonstrates its resilience and ability to deliver strong financial returns in a challenging marketplace.

PERFORMANCE HIGHLIGHTS

Figure A Sources of Gross Receipts

Spirits (24.8%) Wine (22.6%) Coolers (14.2%) Other (2.7%) Merchandising (0.1%) Beer (35.6%)

Figure B Application of Gross Receipts

Payments to Province (31.5%) Administrative Expenses (15.1%) Federal Taxes (13.3%) Suppliers (40.1%)

The Commission spent approximately $59.4 million on alcohol from both domestic and international sources. Gross margins remained stable over the prior year period.

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Dave has a passion for exploring the diverse world of wine, beer, and spirits. He is always on the lookout for unique styles, innovative interpretations of classic favourites, and exceptional products crafted using traditional methods. After earning his WSET Level 3 Award with Distinction in both the tasting and theory examinations, Dave combines his extensive product knowledge with years of teaching experience. At our Granville Street location, he enjoys sharing his enthusiasm for learning, helping both customers and colleagues discover new favourites with confidence. Dave believes there's a perfect drink for everyone—whether it's to complement a meal, suit a particular occasion, match your mood, or simply fit your personal taste. He finds genuine satisfaction in helping people discover that perfect sip. Stop by our PEI Liquor Granville store located at 475 Granville Street in Summerside and let Dave help you find your next favourite wine, beer, or spirit. FEATURED PRODUCT ADVISOR David McCormack

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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.

% of Target 2025 - 2026

PERFORMANCE MEASURES

Actual 2024 - 2025

Target 2025 - 2026

Target 2026 - 2027

Actual 2025 - 2026

Customers served

99.83%

2,506,118

2,500,000

2,450,000

2,495,770

Average customer transaction value

99.11%

$55.89

$58.44

$61.42

$57.92

% of Target 2025- 2026

Actual 2024 - 2025

Target 2025 - 2026

Target 2026 - 2027

Actual 2025 - 2026

Litres

Beer (Including draught)

8,774,077

8,840,100

8,619,323

97.50%

8,610,000

840,901

852,700

828,203

97.13%

820,000

Spirits

Wine (Including BYO)

1,714,400

1,737,800

1,692,314

97.38%

1,740,000

2,531,358

2,590,700

2,684,817

103.63%

Refreshments

2,831,000

Total

13,860,736

14,021,300

13,824,657

98.60%

14,001,000

PERFORMANCE HIGHLIGHTS

Overall beer volume declined by 2%, while dollar sales increased by 1%. The rate of decline in the beer category has slowed as more consumers return to lighter beer styles. The non-alcoholic segment continues to experience strong growth, while craft beer volume has begun to moderate. Spirits volume declined by 3%, while dollar sales decreased by 1%. The category experienced broad-based softness across most segments, with the largest declines coming from vodka, gin, and rum. Although tequila remains the primary growth driver within spirits, its rate of growth has moderated compared to previous periods. Ready-to-Drink (RTD) volume increased by 5%, while dollar sales grew by 7%. The RTD segment remains the primary driver of product volume growth, with its strong performance substantially offsetting declines across the traditional categories of Beer, Spirits, and Wine, helping to limit the overall volume decline. Consumer demand continues to evolve within the category, with growth extending beyond traditional offerings into higher-ABV products, better-for-you alternatives, and no- and low-alcohol options.

16 | PEILCC 2025-2026 Annual Report

Wine volume declined by 2%, while dollar sales increased by 1%, demonstrating resilience in the category despite softer consumption trends. Overall, the wine category continues to outperform national trends, indicating strong performance within the market. Local and Canadian wines have delivered positive growth and remain important drivers of category performance. Consumer demand for innovative products, particularly in the low- and no-alcohol segment and lower-sugar wines, continues to grow and presents opportunities for further category expansion. Investing in employee development remained a priority this past year, with 59 employees completing advanced Wine & Spirit Education Trust (WSET) training across Levels 1, 2, and 3. This industry-recognized education strengthens product knowledge and expertise, enhancing our employees’ ability to confidently assist customers and deliver exceptional service.

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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.

% of Target 2025 - 2026 84% 104.7% 96.6% 100%

Actual 2024 - 2025 9.8%

Target 2025 - 2026 10.0% 95% 3,200 100%

Target 2026 - 2027 10.0% 95% 3,200 100%

Actual 2025 - 2026 8.4% 99.5%

PERFORMANCE MEASURES

Number of ID Checks as a % of transactions Licensee Compliance Rate

97.7% 3,539 100%

3,091 100%

Number of Inspections Conducted % of Sanctions without Adjudication

PERFORMANCE HIGHLIGHTS

The PEI Liquor Control Commission (PEILCC) is required to dedicate 3% of the combined net profits of the PEILCC and PEI Cannabis Management Corporation (PEICMC) to social responsibility initiatives. In fiscal 2025-2026, this commitment generated contributions of $524,366 from the PEILCC and $223,870 from the PEICMC, for a total investment of $748,236. Through these funds, the PEILCC partnered with the PEI Community Foundation to provide $150,000 in grants supporting programs that promote healthy behaviour as it relates to alcohol consumption, helps reduce alcohol-related harms, promote community safety and the overall responsible use of alcohol. To ensure broad provincial access to funding, the grant program was divided equally, with $75,000 allocated to rural communities and $75,000 allocated to urban communities. An additional $150,000 was provided to the Department of Health and Wellness to support evaluation and future planning related to the Less is Best campaign and the broader Alcohol Strategy Project. The funding supported targeted television, streaming, and digital advertising, while advancing key alcohol harm reduction and youth prevention initiatives, including the exploration of Minimum Unit Pricing (MUP) and implementation planning for the PreVenture youth prevention program. The PEILCC also supported a variety of community-based organizations and programs, including MADD Canada, social responsibility radio campaigns, safe ride initiatives, and the University of Prince Edward Island and Holland College’s Keep It Social Program. Throughout the year, the PEILCC delivered targeted responsible-use messaging through local media, social media channels, event signage, and displays in strategic locations across the province. Promoting the responsible use of alcohol remains a key priority for the PEILCC. This is achieved through responsible-use messaging, and ongoing staff education initiatives. The GoEasy campaign was launched this year as part of a refreshed social responsibility initiative aimed at promoting responsible consumption. The slogan, "GoEasy – Make Informed Choices When Consuming Alcohol and Cannabis," was introduced at the Cavendish Beach Music Festival in July 2025. Since its launch, the message has been incorporated into a variety of promotional and awareness channels, including billboards, branded merchandise, and advertising campaigns, helping to reinforce responsible consumption messaging across the province. Key programs include ID training for PEILCC retail and agency store employees, as well as the Check 30 identification program.

18 | PEILCC 2025-2026 Annual Report

The PEILCC continued its longstanding partnership with MADD Canada by supporting the Multi-media School Assembly Program during the 2025–26 school year. This initiative featured 28 presentations of one of the following 45-minute videos; One Last Dance, Final Play, No Tomorrow, Wrong Turn or Over the Edge, in both English and French that reached students in 26 schools across Prince Edward Island As part of its commitment to impaired driving prevention and awareness, the PEILCC provided $40,000 to support the development of a MADD Canada memorial monument honouring victims of impaired driving. Additional support for MADD Canada includes the continuation of the in-store retail ice program at selected corporate retail locations. The PEILCC also maintained its commitment to promoting safe transportation options through its partnership with ride-share provider KARI. Promotional ride discounts were offered during the holiday season and at major events such as the PEI Spirits Festival and the PEI Festival of Wines, helping Islanders celebrate responsibly. In addition, the PEILCC sponsored a shuttle service for the Cloggeroo Festival, providing attendees with a safe and convenient transportation option and further supporting responsible event participation across the province.

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If you look under 30, you must have a valid ID ready when shopping in our corporate or agency stores or when visiting a licensed establishment.

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 eighth 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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CHARITY OF THE MONTH The PEI Liquor Control Commission (PEILCC), in partnership with the PEI Cannabis Management Corporation (PEICMC), continued their Charity of the Month Campaign donating to several charitable organizations across the province. Funds for this initiative are raised through an in store program where the customer is asked if they would like to round up their purchase amount to the nearest dollar with the difference being donated to that months designated charity. This initiative was successful once again in its second year generating a combined $498,680 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 Red Cross ALS Society of PEI MADD Canada Island Shelters (5)

• • • • • •

Canadian Mental Health Association of PEI

Local Youth Initiatives (6) Island Food Banks (7) Special Olympics of PEI

QEH/PCH/IWK Foundations Alzheimer’s Society of PEI

Diabetes Canada PEI Humane Society

22 | PEILCC 2025-2026 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.

% of Target 2025 - 2026 120%

PERFORMANCE MEASURES Training Hours per Employee - FTE EMPLOYEE EXCELLENCE Plan Employee Wellness Rate Lost-Time Frequency

Actual 2024 - 2025 24.2 67.76% 97.7% 5.1

Target 2025 - 2026 10

Target 2026 - 2027 10

Actual 2025 - 2026 12.0

49.6% 99.3% 51.4%

90% 98% 8

90% 98% 8

44.65% 97.36% 4.11

PERFORMANCE HIGHLIGHTS

During the 2025-2026 fiscal year, the PEI Liquor Control Commission continued to invest in employee development, wellness, and workplace safety, achieving strong results in several key performance areas. Learning and Development: Employee training and professional development remained a priority throughout the year. The organization achieved an average of 12 training hours per full-time equivalent employee, exceeding the annual target of 10 hours by 20%. This result demonstrates a continued commitment to enhancing employee skills, supporting career growth, and building organizational capacity. Employee Excellence Plan Completion: The completion rate for Employee Excellence Plans reached 44.65%, significantly below the established target of 90%. While progress was made in implementing performance planning and development processes, this area represents an opportunity for improvement in the coming fiscal year. Efforts will focus on increasing participation, strengthening accountability, and ensuring employees and supervisors are supported in completing performance planning requirements. Employee Wellness: The organization maintained a high level of employee wellness, achieving a wellness rate of 97.36%, narrowly below the target of 98%. This strong result reflects the effectiveness of workplace wellness initiatives and the organization's ongoing commitment to supporting employee health, safety and well-being. Workplace Safety: Workplace safety performance exceeded expectations during the fiscal year. The Lost-Time Frequency was 4.11 days, substantially better than the target of 8 days. This achievement highlights the success of safety programs, employee awareness initiatives, and proactive risk management practices that contributed to reducing workplace injuries and lost-time incidents. Overall Performance: Overall, the organization demonstrated strong performance in employee training, wellness, and workplace safety, with training hours and lost-time frequency exceeding established targets and wellness results remaining exceptionally high.

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STATISTICS Retail Gross Receipts by Store

Year Ended March 31, 2026

Gross Sales $26,680,544 $16,745,763 $15,657,582 $11,508,222 $11,512,727 $8,513,684 $6,829,893 $5,619,944 $4,953,279 $4,269,901 $4,113,376 $3,809,250 $3,507,390 $3,055,862 $2,612,173 $2,557,522 $2,436,490 $2,051,257 $1,641,307 $1,982,896 $140,059,061 Year Ended March 31, 2025

Year Ended March 31, 2024

Retail Store Licensee Oak Tree West Royalty Granville Stratford Montague Cornwall Waterfront Kensington North Rustico Queen Street Tignish Souris O’Leary

$27,020,600 $17,196,412 $15,567,560 $11,316,549 $11,692,178 $8,673,363 $6,891,552 $4,990,274 $5,007,526 $4,208,041 $4,382,439 $3,798,295 $3,525,669 $3,072,094 $2,526,325 $2,579,509 $2,421,561 $1,844,881 $1,648,366 $1,961,912 $140,325,106

$27,218,816 $17,465,625 $16,233,618 $12,069,553 $11,834,558 $8,819,527 $6,918,258 $5,855,437 $4,984,159 $4,526,179 $4,191,505 $3,856,675 $3,680,771 $3,188,542 $2,703,751 $2,566,176 $2,508,270 $2,171,169 $1,815,962 $1,951,956 $144,560,507

Cardigan Alberton Gateway Notables Tyne Valley Other Revenue Streams Total

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

Murray Harbour North Wiltshire Oyster Bed Bridge Wood Islands Wellington

Summerside - Granville Summerside - Waterfront Tignish Tyne Valley

PEILCC 2025-2026 Annual Report | 25

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

(in 000s)

2026 144,560 40,355 21,360 22,413 27.92% 14.78% 15.50%

2025 140,059 40,343 23,541 20,264 28.80% 16.81% 14.47%

Gross Receipts Gross Profit Net Income

General & Administrative Expenses Gross Profit as a % of Gross Receipts Net Profit as a % of Gross Receipts General & Administrative Expenses as a % of Gross Receipts

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

6,889 (4.66%) Operating Costs

19,607 (13.25%) HST & Other

15,524 (10.49%) Salaries & Benefits

Total Sales 147,977 (including other income)

46,576 (31.48%) Returned to PEI

59,380 (40.13%) Cost of Product

26 | PEILCC 2025-2026 Annual Report

SALES VOLUMES (litres) by Category

COOLERS 2,684,817 (19.42%)

SPIRITS 828,203 (5.99%) WINE 1,692,314 (12.24%)

BEER 8,619,323 (62.35%)

Total: 13,824,657

PEILCC 2025-2026 Annual Report | 27

Total Licenses and Special Permits

Year Ended March 31, 2026

Year Ended March 31, 2025

License Type

17 24 36 197 10 5 12 115

0 19 35 207 11 5 12 106 13 21 87 160 6 8 690

Brew Pub Caterer Club Dining Room Distillery Ferment on Premises Liquor Agency Lounge Micro-Brewery Military Canteen Package Sales Special Premise Tourist Home Winery Total Licenses in Effect

12 21

102 168 7 8 734

Year Ended March 31, 2025

Special Permits Issued

Year Ended March 31, 2026

111 87 198

Class I Class II Total

116 106 222

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PEILCC 2025-2026 Annual Report | 29

FEATURED PRODUCER Holy Whale Brewing Co. Holy Whale Brewing Co. began the way many great things do—on a quiet street in Charlottetown, with two brothers, a backyard, and a shared obsession. Jeff and Peter Grandy first fell in love with craft beverages not in a commercial brewery, but in their parents’ basement on Sidmount Avenue, where they spent years experimenting with wine kits. That early curiosity eventually led Jeff to the Brewmaster program at Olds College in Alberta. Midway through, he called Peter—then working abroad—and floated the idea of starting a brewery together. Peter said yes without hesitation. Their longtime friend Ian Hillier soon joined to help turn the dream into reality.

30 | PEILCC 2025-2026 Annual Report

New products still start the same way: an idea sparked by curiosity, customer feedback, or pure fun. Pilot batches are tasted, refined, and only released when the brothers would happily pour them for their own family. Some experiments become cult favourites; others simply teach them something new. Either way, every can and every pint carries the same quiet responsibility—the knowledge that someone is choosing to spend their hard-earned money on something Holy Whale created. At its heart, Holy Whale remains a family-owned, independent brewery built on curiosity, hard work, and gratitude. After nearly a decade away, brewing once again on Prince Edward Island feels like coming full circle. The brothers still love making people smile—whether with a perfectly balanced classic or an occasional off-the-wall creation—and they never forget how lucky they are to do this work.

In the early days they brewed on a homemade system lent by friends, turning out batches in the backyard of Jeff’s small house on Richmond Street. Many of the recipes that still anchor Holy Whale’s lineup were born there. Their original philosophy was simple: brew only the beers they loved—hop-forward IPAs and Belgian-style ales. It didn’t take long to learn that a successful brewery has to speak to a wider audience. That realization shaped everything that followed. Today the brewery’s range stretches from crisp, approachable lagers and classic ales to inventive sours and ready-to-drink beverages, all while keeping the spirit of experimentation alive. Although Holy Whale spent its first decade growing in Alma, New Brunswick, Prince Edward Island has always been home. Opening the Charlottetown brewery and taproom this past winter fulfilled a dream the founders carried from day one—finally brewing beer back in the place where it all began. Their passion for pairing beer with food runs just as deep. Long before the brewery opened, the brothers hosted dinner parties for friends and family, cooking the meals themselves and guiding guests through thoughtful pairings. Living on an island famous for its seafood, they still rave about crisp lagers and lighter ales alongside oysters, mussels, lobster, and fish and chips. Hoppier beers shine with spicy dishes, burgers, and barbecue; darker styles love smoked meats and comfort food. Their RTDs play just as nicely with charcuterie, salads, tacos, and summer grills. The real favourite pairing, though, remains the simplest: good food, good drinks, and good company. Signature beers tell the story of who Holy Whale is. Poolboy Ultra Light (4%) is the crisp, crowd-pleasing lager that proves how hard it is to make something simple truly excellent. Devil’s Half Acre IPA (7%) is the juicy New England flagship that nods to the hop-forward beers that first inspired them. Champ APA (5.5%) has been a reliable, flavour-packed favourite almost since the beginning. And then there’s Taste the Rain, Bro—the playful Skittles-inspired sour born after

Available at PEI Liquor retail stores

Holy Whale Swedish Barrie Pizzazzler Seltzer 18283H | 4 PK

Holy Whale All-Inclusive Pizzazzler Seltzer 18284H | 4 PK

Holy Whale Nerdlinger Pizzazzler Seltzer 18284H | 4 PK

a night of watching The Simpsons and wondering if they could capture that candy-coated joy in a glass.

PEILCC 2025-2026 Annual Report | 31

Get a safe ride home

32 | PEILCC 2025-2026 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:

• 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

Aaron Lawlor, Chief Financial Officer

PEILCC 2025-2026 Annual Report | 33

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)

34 | PEILCC 2025-2026 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.

MRSB CHARTERED PROFESSIONAL ACCOUNTANTS INC. Charlottetown, PE June 25, 2026

PEILCC 2025-2026 Annual Report | 35

PRINCE EDWARD ISLAND LIQUOR CONTROL COMMISSION Statement of Financial Position March 31, 2026

2026

2025

ASSETS

Current

Cash Accounts receivable (Note 5) Inventory (Note 6) Prepaid expense

$2,890,485 1,576,939 11,371,979 160,689 16,000,092 7,626,128

$3,650,673 1,737,857 11,798,966 170,493

17,357,989 8,458,014

Property and equipment (Schedules 1 and 2)

$ 23,626,220

$ 25,816,003

LIABILITIES

Current Accounts payable and accrued liabilities (Note 7) Deferred revenue Deferred lease inducements Due to the Province of Prince Edward Island (Note 8) Current portion of lease liabilities (Note 9)

$5,641,286 734,578 - 15,362,869 849,219

$5,729,377 683,073 53,191 13,811,583 823,949

22,587,952 3,228,051

21,101,173 2,525,047

Lease liabilities (Note 9)

$25,816,003

$ 23,626,220

Contractual obligations (Note 10)

On behalf of the Board _____________________________ Chair _____________________________ Commissioner Notes 1 - 19 are an integral part of these financial statements

36 | PEILCC 2025-2026 Annual Report