A message from the Chairman of the Board

Brett Stephenson, Chairman

Dear Ace Shareholders,

I am continually amazed at what can be accomplished when we all stand together and march toward a common purpose. Think about where we were just a few short years ago. The challenges we’ve faced. The obstacles we’ve overcome. And the success we’ve enjoyed.

What’s happened in our stores over the past few years is nothing short of amazing. At the risk of sounding repetitive, 2022 had all the markings of another challenging year – and it was. But together, we met those challenges head-on. And, like we always do, Ace came out stronger on the other side.

• Our financials remain solid – 13 years in a row of increased same-store sales and same-store gross profit
• Our customers are happy – 86.8% Customer engagement score
Our employees are engaged – 88% Employee engagement score

Through it all, we as a company maintained our servant hearts and generosity, helping the Ace Foundation raise an astounding $22.8 million overall in 2022. This includes funds for Children’s Miracle Network (CMN) Hospitals, the American Red Cross, Habitat for Humanity and our own Ace Helpful Fund.

These are impressive results that we should all be proud of. It shows the power we have and the difference we can all make in our local communities. But it also feeds into something much bigger than just one store or one chain. When results like that are achieved nearly across the board at the local level, it propels our entire brand forward. And because of that, the power of the Ace brand has never been stronger. Here’s what I mean:

• 5th largest franchise in the world, with system-wide revenue of $22.4 billion
• 7th best franchise in the world according to Entrepreneur Magazine
• 20th largest retailer in the United States according to the National Retail Federation
• Named one of America’s Best Employers & Most Admired Companies by Forbes
• Ranked #2 Top Omnichannel Retailer by Total Retail, Top 100 Retailers
• Ranked #1 in Customer Satisfaction by J.D. Power 15 out of 16 years
• Ranked as Top 16 Leader Overall and Highest in "Home Improvement" for Omnichannel Customer
  Service by Incisiv
• Ranked in Top 10 (#8) of Most Trusted Retail and Ecommerce Brands by Morning Consult

On behalf of the entire Board, thank you again for your tireless efforts to serve your neighbors, advance our brand and ensure Ace will always be the most helpful hardware stores on the planet.

Brett Stephenson
Chairman of the Board