Magnit

Russia’s Magnit raises 2012 sales guidance

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Fast growing Russian retailer Magnit on Monday raised its full-year 2012 sales guidance to 30-32 percent from 30 percent and said growth was expected to slow down to 25-27 percent next year.

Magnit, Russia’s top grocery chain with more than 5,700 stores, also said its capital expenditure programme would total $1.6-1.7 billion this year and $1.6-1.8 billion in 2013.

This year’s margin on the basis of earnings before interest, taxation, depreciation and amortisation (EBITDA) is seen at 9.0-9.5 percent, the company said in a statement.

The company said in July it would keep expanding aggressively next year, with preliminary capex guidance at $1.8-2.0 billion.

Source: in.reuters.com

Changes of X5 Retail Group

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A month ago Andrei Gusev resigned CEO of X5 Retail Group; and last week Alexander Ermolenko, director of logistics, who had began to work for X5 Retail Group after quitting “Magnit” more than a year ago, and his deputy Vyacheslav Mikhnenko, who before had worked for retail network “Kopeyka”, resigned their positions as well.

In the result, Igor Sotnikov, who previously worked as director of logistics for supermarket format, was appointed director of logistics of all the formats of X5 stores.

Also Ian Fuchs resigned director of hypermarket format of X5 Retail Group. He was appointed to the position in November 2011.

Last week the information appeared that X5 Retail Group is negotiating the purchase of Stavropol retail network “Troyka” and “Sem’ja”. As a result of the transaction, X5 can get 12,000 square meters of their stores in Stavropol region and Karachaevo-Cherkesskij region or some stores located in Stavropol and Nevinnomyssk. So far, X5 does not have its own stores in Stavropol region, and, according to some experts, it can spend 300-700 million rubles for the entry to the region.

Source: www.retailer.ru

Sergey Galitsky will spend € 350 million for vegetables

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Sergey Galitsky, founder of the second largest Russian retail network “Magnit”, is planning to invest € 350 million in the agricultural development. He said that this is a key point to develop the network own agricultural production.

“We decided to grow local Kuban vegetables for our stores. Now we have the crop of cucumbers and tomatoes from 40 hectares, and for the next two years we plan to expand the area to 120 hectares”, – Sergey Galitsky said.

It will be one of the biggest agricultural complexes that produce vegetables in Europe.

The fact that “Magnit” would invest 8 billion rubles in the construction of the greenhouse complex to grow tomatoes and cucumbers in Dinsky district of Krasnodar region was reported in 2010. Then the experts believed that it would be difficult for the retail network to find consolidated suppliers of fresh vegetables which could supply all vegetables for the company.

Source: www.fruitnews.ru

X5 may not reach expected results

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Sales growth of the biggest Russian retailer X5 Retail Group would not reach previously expected 15 per cent, Kieran Balfe, chief financial officer, warned investors on a conference call. Earlier Balfe said that the growth rate would be about 15 per cent for this year – but for the first half of the year X5 revenues rose by only 7.2 per cent.

The sales in hypermarkets fell by 14 percent in July. Net profit of the retailer fell by 6.2 percent to $ 68.9 million. EBITDA decreased by 1.6 percent to $ 280.3 million.

Despite the fact that the X5 Retail these results are still not bad, they do not seem so so good if compared to the indicators of the Magnet, X5 main competitor, according to VTB Capital analysts. Magnit EBITDA profitability reached 10.1 percent in the second quarter.

Source: www.retailer.ru

 

Magnit attracts higher sales

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Like-for-like sales increase 3.5 per cent during the opening half of the year

Russian retailer Magnit has revealed that its sales climbed by 3.5 per cent during the opening six months of 2012, when compared with the same period of 2011.

Despite the growth, the figure represented a drop on the first quarter of 2012, when year-on-year sales growth came in at 4.12 per cent, Reuters reported.

Consolidated net sales soared by over 32 per cent to RR207.5bn (€5.1bn), with store openings boosting overall selling space by 31 per cent.

June sales alone increased by 33.8 per cent to RR36.4bn (€897m), the group said.

Source: www.fruitnet.com

Second tier retail chains are leaving the Russian market.

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Second tier retail chains are leaving the Russian market, Sergey Galitsky, Magnit CEO, said during the telephone conference. Meanwhile the competition among top three retail chains – X5 Retail Group, Magnit and Dixi – will keep escalating. Sergey Galitski confirmed their plans to raise gross revenues in 2012 at 25-30%, and EBITDA – at 7.5-8%. Magnit is one of Russia’s largest retail chains in terms of sales volume. As of 31 December 2011, the company operates 5,309 stores, including 93 hypermarkets and 210 drogery shops.

Source: www.retail.ru

Magnit eyes small competitors

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Fast-growing Russian food retailer Magnit is interested in acquiring smaller rivals as growing competition is set to leave less room for organic expansion, its CEO said on Friday.

“Competition is growing every day but we still have opportunities for more or less comfortable growth. What we see is the trend of replacement of second-tier chains and probably we all – (rivals) X5, Dixy and ourselves – are showing interest,” Sergei Galitskiy said.

Magnit has grown into Russia’s top food retailer by store count via organic expansion and also ranks second to X5 Retail Group in revenue terms.

Last year, it paid $32 million for a chain of some 14 stores in the Tambov region in central Russia, and plans to buy the remaining interest for $3.6 million this year, it said in audited full-year financial report on Friday.

Magnit and X5 control between them under 10% of the Russian food retail market which is widely expected to consolidate mainly at the expense of small regional chains and unorganized retail.

Source: www.freshplaza.com

Magnit has opened 712 stores in 2011

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“Magnit”, Russia’s largest retail chain in terms of the number of stores, announced the unaudited operating results for the first three quarters of 2011.

Provisional unaudited consolidated retail earnings (VAT excl.) since the beginnings of 2011 reached RUB 240.1 bn, which is 46% more than in the same period in 2010.

In the first 9 months of 2011 the retailer has opened 712 stores. The total number of chain stores has reached 4,767: 4.593 convenience stores, 76 hypermarkets and 98 drugstores.

Source: www.retail.ru

Magnit opens new distribution center in Dzerzhinsk

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OJSC Magnit, one of Russia’s largest hypermarket chains, has opened a new distribution center in Dzerzhinsk, Nizhniy Novgorod region.

Total space of the warehouse is 30,523sqm. Launch of the new distribution center is expected to improve the quality of service in the Central region.

Magnit retail chain operates 13 distribution centers with their total capacity of 299,443sqm. As of June 30, 2011, the chain consisted of 4,366 convenience stores, 66 hypermarkets and 28 cosmetics stores (drogerie) in 1,286 locations in the Russian Federation.