Magnit

Magnit sees 58.7% Revenue Growth in H1 2011

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Russian food retailer Magnit reported on Monday a 58.7% year-on-year increase in revenues in H1 2011, spurred by the opening of 405 new stores. The company said that in dollar terms net retail sales reached $5.47 billion. In rouble terms, sales grew 51% in H1 to 156.53 billion roubles. Like-for-like sales grew by 18.6% compared to the corresponding period a year ago. At the end of June, the company operated a total of 4,460 stores, vast majority of which are convenience stores.

Source: www.freshplaza.com

Magnit’s Net Sales Grew by 47.3% in May

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In May 2011 Magnit (RTS: MGNT) reported net retail sales growth by 47.3% y-o-y. Net retail sales reached RUB 27.3 bln. During HY1 2011 net retail sales increased by 52% and reached RUB 129 bln. The observed temporary slowdown in growth is due to the fact that many shops are shut down for renovation.

Significant sales growth is stimulated by opening of the new shops and sales area expansion. There were 86 new shops opened in May, including 2 hypermarkets. In the HY1 2011 the total number of new shops reached 308, among which 13 hypermarkets.

The fast-growing sales areas increased by 39.6% in May and reached 1.571 mln sq m. Magnit’s area growth pace  exceeds this figure by X5 Retail Group 1.5-fold.

Source: www.retail.ru

Russian Retailers Ready for Further Expansion

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In March 2011 Russia’s 90 largest retail chains added 49 shops to the total number, which has grown by 111 since the beginning of the year. Discounter format is still leading in the market, but  hypermarkets are also gathering pace. In Q1 2011 Magnit opened 222 shops, among which 211 discounters and 11 hypermarkets. Enhancement of competition within the branch will contribute to further consolidation, and in the 2nd HY 2011there will be more new shops opened.

At the same time X5 Retail Group is less ambitious and only planning to open 500 discounters, up to 25 supermarkets and 10 hypermarkets. The company is also working on new formats. During January – March X5 opened 80 new discounters and 2 supermarkets.

Source: www.retail.ru

Foreign Retail Chains Fail to Seize Control over Russian Retail Market

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Foreign retail chains in Russia haven’t succeeded in replacing domestic retailers yet. According to INFOLine agency, in 2010 the share of national retail chains was as large as 77.5%. Western retailers occupied the DIY segment, where Castorama, OBI, Leroy Merlin, K-Rauta and others control almost 73% of the market. International food retail chains couldn’t raise their share in the Russian market. Among other reasons experts mention Carrefour’s and Walmart’s misadventures in Russia. Domestic retail survived due to the rapid growth of the largest food retail operators like Magnit and X5.

Source: www.retail.ru

Demand for Shares of Magnit Retail Chain

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According to experts’ opinion, their index will be restored due to the expansion of sales areas and increase of net sales. In Q1 2011 Magnit opened 134 stores, among which 126 convenience stores, 6 hypermarkets and 2 drugstores. The company’s sales area grew by 36%, from 1,092.6 sq.m in Q1 2010 to 1,485.72 sq.m in Q1 2011. The total number of the chain’s stores is 4,189. Today the retailer’s shares top the favorites list. In the middle of trading the company’s quotations grow by 4.577% up to RUB 3,879.8, whereas the MICEX index added 0.744% to 1,690.62 points.

Source: www.retailer.ru

Federal Retail Chains Dominate the Market

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Aggressive expansion policy of the largest retailers has reached its aim: 5 largest chains account for 70% of retail areas augmentation in 2010.

The INFOLine analytical agency reports, that 2010 Russia’s ninety largest retail chains added ca. 1m sq.m of new sales areas, of which 55% fell on two largest market players – Magnit and X5 Retail Group. 2009 they had a 48.2% share in the total volume of newly opened sales areas. Top five food retailers, including Auchan, Metro Cash & Carry and Okey, accounted for 72.3% of the areas augmentation). The rest 27.7% were shared among 47 other retail chains.

Source: www.fruitnews.ru

Magnit’s Profit to Drop

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Magnit retail chain, one of Russia’s largest retail operators, has reported a worse-than-expected drop in profit for its fiscal first quarter by 5.5% y-o-y to USD 61.01m according to IFRS. In RUB terms the company’s net profit dropped by 7.5% and made RUB 1.786bn. The company’s income within the fiscal period grew by 56.5% and reached USD 2.564bn. In RUB terms the income went up by 53.14% and reached RUB 75.052bn. The income growth is due to the sales area expansion and growth of the like-for-like sales by 20.15% (VAT exclusive). The retailer’s EBITDA in USD terms grew by 30% to USD 161.97m, in RUB terms – by 27.25% to RUB 4.741bn.

CEO Sergei Galitsky noted: “We liked sales growth in the first quarter and did not transfer additional expenditures through increase of fuel costs and social tax to the customer which resulted in lower EBITDA versus consensus. But from the second quarter we have started to gradually transfer increased costs to the customer, at that we are confident in fulfilling EBITDA margin and sales plan provided earlier.”

Source: www.retail.ru, www.freshplaza.com

Federal Retail Chains to Change Development Strategy

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Federal grocery chains in the North-Western Federal district were traditionally fighting for consumers in St. Petersburg. Since 2009 the battle has been gradually moving towards the periphery. Retailers are ready to reconsider their development strategy and enter small towns in province with population less than 10.000 people, which have been interesting for only one retail chain – Magnit. Magnit occupied this niche and built the largest retail chain in Russia. Retailers who will be the first to enter towns and villages, which are not yet occupied by Magnit, will win the race and occupy the share of the regional market.

Source: www.retailer.ru

Facts and Figures about Russian Retail Market 2011

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2011 the Finnish retail chain Prisma is planning to open a new hypermarket and two supermarkets in St. Petersburg. The premium-class supermarket chain Globus Gourmet will open four stores in Moscow and St. Petersburg, with the investment volume reaching RUB 600m. Russia’s retail market leaders – X5 Retail Group and Magnit – accounted for 80% of all the new stores opened by the largest market players in Q1 2011. Dixy’s net revenues in 2010 amounted to RUB 257.7m. The sales of Lenta, retail chain from St. Petersburg , grew by 35% in Q1 2011.

Source: www.retailer.ru

Magnit Grows Faster than Х5

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The profit of “Magnit” in RUR terms grew by 53.15% in Q1 2011 y-o-y and reached RUR 75.3bn. In USD terms the profit increased by 56.4% to USD 2.56bn. Magnit’s profit in the segment of hypermarkets has doubled in Q1 2011 and reached RUR 8.86bn and USD 296.6m.

Magnit’s net retail profit in March 2011 grew by 53.75% y-o-y and reached RUR 27.3bn.
During January-March 2011 Magnit opened 134 outlets and the total number of stores grew to 4189. During the same period X5 Retail Group opened 76 new stores with the total number increasing to 2545.

Source: www.foodretail.ru