MAGNIT 
By
Press-release
Krasnodar
January 10, 2014
OJSC "Magnit" Announces 29.22% Retail Sales Growth in Rubles for 2013[1]
Krasnodar, January 10, 2014: OJSC "Magnit", Russia's largest
retailer (the "Company"; MICEX and LSE: MGNT) announces 29.22% retail sales
growth in rubles for 2013.
During December 2013 the Company opened (net) 173 stores. The total
store base reached 8,093 stores (7,200 convenience stores, 161 hypermarkets,
46 "Magnit Family" stores and 686 cosmetics stores).
Preliminary consolidated unaudited net retail revenue (excl. VAT)
in 12M 2013 increased by 29.22% in ruble terms (compared to 12M 2012) and
stood at 579,528.48 million rubles.
Magnit Sales Growth guidance for 2013 (28-29%) has been achieved
with full-year actual Sales Growth of 29.22%.
For the month of December 2013, please note the following reasons
for the slowdown year-to-year in the monthly Sales Growth rate:
1. A decline of consumer activity of households which was reflected
in the slowdown of the average ticket growth rates in December 2013 y-o-y. We
see a clear trend of customers refocusing towards products in lower price
segments. This trend is representative of all product categories and social
consumer groups. Nonetheless, it is important to note that there is no abrupt
transition from the expensive to the cheap but the changes are of a smooth
nature and as a rule one level lower in price category.
2. A slowdown in sales growth rates for convenience stores, which
began on December 20th. The slowdown was due to the following factors:
A. The growth in the number of large formats now operating in
Russia. In the last year there were a massive number of openings, which
resulted in a transition of consumer preferences in favor of Hypermarkets and
Shopping Centers during the period of the New Year holidays. This fact can be
seen by the growth of sales for Magnit's hypermarkets in the above-listed
period. This trend is consumer preferences is traditional for food retail
globally and has become noticeable in Russia in 2013, in particular.
B. Abnormally warm weather in the second half of December in the
European part of Russia (8 degrees Celsius warmer on average) resulted in
higher activity for open markets and grocery fairs compared to the previous
years.
We assume that the future New Year's sales growth rate for
convenience stores should not exceed 15-17%.
Magnit is pleased by the sales and efficiency results achieved in
2013. Please note that on January 27th, 2014 Magnit will publish a press
release with its unaudited full-year "management accounts" results.
[1] According to management accounts
December 2013 Key Operating and Financial Highlights:
December 2013 December 2012 Growth Rate
Number of opened stores, NET 173 407 n/a
convenience stores 140 293 n/a
hypermarkets 9 13 n/a
magnit family 12 3 n/a
cosmetics stores 12 98 n/a
Total number of stores 8,093 6,884 n/a
convenience stores 7,200 6,046 n/a
hypermarkets 161 126 n/a
magnit family 46 20 n/a
cosmetics stores 686 692 n/a
Selling space growth, thousand sq.m. 77.51 156.68 n/a
convenience stores 38.90 89.38 n/a
hypermarkets 22.82 39.13 n/a
magnit family 13.24 4.00 n/a
cosmetics stores 2.55 24.17 n/a
Selling space, eop, thousand sq. m. 3,011.38 2,549.26 18.13%
convenience stores 2,312.20 1,977.46 16.93%
hypermarkets 482.88 387.62 24.58%
magnit family 53.26 24.36 118.67%
cosmetics stores 163.04 159.83 n/a
Number of customers, million 234.52 196.11 19.59%
convenience stores 204.82 175.30 16.84%
hypermarkets 20.15 15.35 31.29%
magnit family 3.79 1.81 109.64%
cosmetics stores 5.76 3.65 n/a
Net retail sales, million RUR 63,624.03 51,779.25 22.88%
convenience stores 47,132.34 39,895.20 18.14%
hypermarkets 13,221.25 10,129.09 30.53%
magnit family 1,640.41 732.01 124.10%
cosmetics stores 1,630.03 1,022.96 n/a
Net retail sales, million US$[2] 1,934.18 1,684.38 14.83%
convenience stores 1,432.83 1,297.79 10.41%
hypermarkets 401.93 329.50 21.98%
magnit family 49.87 23.81 109.43%
cosmetics stores 49.55 33.28 n/a
[2] Based on the average exchange rate for December 2013 of 32.8945
RUB per 1 USD, December 2012 - 30.7408 RUB per 1 USD
4Q and 12M 2013 Key Operating and Financial Highlights:
4Q 2013 4Q 2012 Growth Rate 12? 2013 12? 2012 Growth Rate
Number of opened stores, NET 447 765 n/a 1,209 1,575 n/a
convenience stores 417 523 n/a 1,154 1,040 n/a
hypermarkets 13 21 n/a 35 36 n/a
magnit family 16 9 n/a 26 17 n/a
cosmetics stores 1 212 n/a (6) 482 n/a
Total number of stores 8,093 6,884 n/a 8,093 6,884 n/a
convenience stores 7,200 6,046 n/a 7,200 6,046 n/a
hypermarkets 161 126 n/a 161 126 n/a
magnit family 46 20 n/a 46 20 n/a
cosmetics stores 686 692 n/a 686 692 n/a
Selling space growth, th. sq.m. 169.99 288.38 n/a 462.12 579.09 n/a
convenience stores 116.46 164.03 n/a 334.74 339.63 n/a
hypermarkets 34.43 62.93 n/a 95.26 109.17 n/a
magnit family 17.83 10.73 n/a 28.91 20.56 n/a
cosmetics stores 1.27 50.68 n/a 3.21 109.74 n/a
Selling space, eop, th. sq. m. 3,011.38 2,549.26 18.13% 3,011.38 2,549.26 18.13%
convenience stores 2,312.20 1,977.46 16.93% 2,312.20 1,977.46 16.93%
hypermarkets 482.88 387.62 24.58% 482.88 387.62 24.58%
magnit family 53.26 24.36 118.67% 53.26 24.36 118.67%
cosmetics stores 163.04 159.83 n/a 163.04 159.83 n/a
Number of customers, million 656.92 549.44 19.56% 2,465.05 2,033.43 21.23%
convenience stores 579.17 497.07 16.52% 2,193.87 1,863.62 17.72%
hypermarkets 53.45 39.47 35.42% 193.06 137.69 40.21%
magnit family 9.57 4.34 120.63% 29.60 8.87 233.84%
cosmetics stores 14.73 8.56 n/a 48.52 23.25 n/a
Net retail sales, million RUR 162,467.00 129,153.84 25.79% 579,528.48 448,486.20 29.22%
convenience stores 123,796.88 102,481.13 20.80% 450,801.48 364,236.40 23.77%
hypermarkets 31,180.71 22,881.23 36.27% 106,175.58 75,418.70 40.78%
magnit family 3,695.40 1,583.85 133.32% 10,678.07 3,098.58 244.61%
cosmetics stores 3,794.01 2,207.63 n/a 11,873.35 5,732.51 n/a
Net retail sales, million US$[3] 4,993.85 4,155.97 20.16% 18,196.70 14,424.02 26.16%
convenience stores 3,805.22 3,297.68 15.39% 14,154.78 11,714.42 20.83%
hypermarkets 958.42 736.28 30.17% 3,333.82 2,425.58 37.44%
magnit family 113.59 50.97 122.87% 335.28 99.66 236.44%
cosmetics stores 116.62 71.04 n/a 372.81 184.37 n/a
[3] Based on the average exchange rate for 4Q 2013 - 32.5334 RUB
per 1 USD, 4Q 2012 - 31.0767 RUB per 1 USD, 12M 2013 - 31.8480 RUB per 1 USD,
12M 2012 - 31.0930 RUB per 1 USD
LFL Results
LFL growth 4Q 2013 - 4Q 2012[4] Convenience stores Hypermarkets Magnit Family Cosmetics stores Total
Average ticket (excl. VAT), RUR 4.21% 2.13% 1.77% 4.92% 4.29%
Traffic (2.03)% 1.75% (2.78)% 26.69% (1.52)%
Revenue, RUR 2.09% 3.92% (1.06)% 32.92% 2.71%
LFL growth 12? 2013 - 12? 2012[5] Convenience stores Hypermarkets Magnit Family Cosmetics stores Total
Average ticket (excl. VAT), RUR 5.35% 2.04% 5.01% 3.72% 5.22%
Traffic (1.57)% 2.52% 7.41% 10.54% (1.28)%
Revenue, RUR 3.70% 4.61% 12.80% 14.65% 3.88%
For further information, please contact:
Timothy Post Director, Investor Relations
Email: post@gw.tander.ru
Office: +7-861-277-4554 x7600
Mobile: +7-961-511-7678
Direct Line: +7-861-277-4562
Dina Svishcheva Deputy Director, Investor Relations
Email: Chistyak@gw.tander.ru
Office: +7-861-277-45-54 x5101
Mobile: +7-961-511-0202
Direct Line: +7-861-277-4562
[4] Based on 4,734 convenience stores and 217 cosmetics stores
which were opened by April 1, 2012, and 90 hypermarkets and 3 Magnit Family
which were opened by February 1, 2012, i.e. based on the result of the
convenience stores that had been operating for not less than six months and
hypermarkets that had been operating for not less than eight months and have
achieved a mature level of sales.
[5] Based on 3,487 convenience stores and 18 cosmetics stores which
were opened by July 1, 2011, and 60 hypermarkets and 1 Magnit Family which
were opened by May 1, 2011, i.e. based on the result of the convenience stores
that had been operating for not less than six months and hypermarkets that had
been operating for not less than eight months and have achieved a mature level
of sales
Company description:
Magnit is Russia's largest retailer. Founded in 1994, the company
is headquartered in the southern Russian city of Krasnodar. As of December 31,
2013, Magnit operated 22 distribution centers and over 8,000 stores (7,200
convenience, 207 hypermarkets, and 686 cosmetics) in more than 1,868 cities
and towns throughout 7 federal regions of the Russian Federation.
In accordance with its reviewed IFRS consolidated financial
statements, Magnit had 1H 2013 revenues of $8.7 billion USD and an EBITDA of
$890 million USD. Magnit's local shares are traded on the Moscow Stock
Exchange (MICEX: MGNT) and its GDRs on the London Stock Exchange (LSE: MGNT)
and it has a credit rating from Standard & Poor's of BB. Measured by market
capitalization, Magnit is now Europe's 2nd largest food retailer.Magnit OAO : OJSC MAGNIT - Magnit December/12M 2013 Results
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