OJSC MAGNIT: Unaudited FY 2012 Financial Results

Press-release 
Krasnodar 
January 22, 2013 
OJSC "Magnit" announces unaudited FY 2012 results 
                                                                            
Krasnodar, January 22, 2013: OJSC "Magnit" (the "Company"; MICEX and LSE: MGNT)
is pleased to announce its unaudited FY 2012 financial results prepared in
accordance with IFRS . 
During 2012 the Company added (net) 1,575 stores (1,040 convenience stores, 36
hypermarkets, 17 Magnit Family stores and 482 cosmetics stores) and increased
its selling space by 29.39% in comparison to 2011 from 1,970.16 thousand sq. m.
to 2,549.26 thousand sq. m. The total store base as of December 31, 2012
reached 6,884 stores (6,046 convenience stores, 126 hypermarkets, 20 Magnit
Family stores and 692 cosmetics stores). 
Revenue in rubles increased by 34% YoY from 335,699.95 million RUR in 2011 to
448,661.13 million RUR in 2012. The top line growth was due to an increase in
selling space as well as to a 5.26% increase of like-for-like sales (excl.
VAT). Revenue growth in dollar terms amounted to 26%: from US$ 11,423.26
million to US$ 14,429.65 million.  
Gross margin grew from 24.33% in 2011 to 26.52% in 2012. Gross profit in rubles
increased by 45.71% from 81,663.45 million RUR (US$ 2,778.86 million) to
118,994.62 million RUR (US$ 3,827.05 million). 
EBITDA increased by 71.62% from 27,604.14 million RUR (US$ 939.32 million) in
2011 to 47,374.54 million RUR (US$ 1,523.64 million) in 2012. EBITDA margin in
2012 amounted to 10.56%. 
2012 net income increased by 103.15% and amounted to 24,994.79 million RUR (US$
803.87 million) vs. 12,303.84 million RUR (US$ 418.68 million) in 2011. 
Sergey Galitskiy, the Company's CEO, provided the following comments on the
published results: 
"Dear Ladies and Gentlemen! 
We carry on the tradition to publish preliminary financial results for the year
as soon as possible, in order that you may understand what is going on with
Magnit. 
In the fourth quarter we set another record for the EBITDA margin and thus,
finished a successful year for us, which is reflected in the current share
price. 
We are already thinking of 2013 and have set a challenging task for ourselves
to open over 1,100 convenience stores, over 60 stores of the hypermarket and
Magnit family format, and 250 cosmetics stores. We also hope that this year we
will launch 4 distribution centers and buy at least 1,200 trucks. We plan that
capex will total approximately US$1.8 bn. I walk you through these numbers in
order to indicate how hard we will work this year. 
Knowing that the market tends to immediately extrapolate any success for many
years ahead we would like to caution our investors from being overly
optimistic. 
The results which we have released are not bad. We appreciate your positive
appraisal of our results. Both the Company and ourselves are travelling though
this life journey for the first time and we are thus, unable to know how
sustainable are these high results. The most important thing for us is the
resilience and competitiveness of the Company. We are still in the process of
winning market share and therefore, we will do our best to be highly
aggressive. We appreciate all of our investors who were with us last year. We
will make all efforts to justify your confidence in 2013". 


    
    4Q and 12M 2012 Key Operating Results
                            4Q 2012  4Q 2011   Growth   12M 2012 12M 2011  Growth  
                                             Rate                        Rate   
                                                                                

Number of opened stores,      765      542       n/a    1,575    1,254       
n/a
NET                                                                             
                                                                                


  convenience stores      523      413       n/a    1,040    1,004       
n/a 
                                                                             
       hypermarkets        21       17       n/a       36       40       
n/a 
                                                                             
       magnit family        9        0       n/a       17        2       
n/a 
                                                                             
    cosmetics stores      212      112       n/a      482      208       
n/a 


                                                                                
                                                                                
                                                                                

Total number of stores      6,884    5,309       n/a    6,884    5,309       
n/a
                                                                                


  convenience stores    6,046    5,006       n/a    6,046    5,006       
n/a 
                                                                             
       hypermarkets3      126       90       n/a      126       90       
n/a 
                                                                             
       magnit family       20        3       n/a       20        3       
n/a 
                                                                             
    cosmetics stores      692      210       n/a      692      210       
n/a 


                                                                                
                                                                                
                                                                                

Selling space, thousand  2,549.26 1,970.16    29.39% 2,549.26 1,970.16    
29.39%
sq. m.                                                                          
                                                                                


  convenience stores 1,977.46 1,637.83    20.74% 1,977.46 1,637.83    
20.74% 
                                                                             
        hypermarkets   387.62   278.45    39.21%   387.62   278.45    
39.21% 
                                                                             
       magnit family    24.36     3.80       n/a    24.36     3.80       
n/a 
                                                                             
    cosmetics stores   159.83    50.09       n/a   159.83    50.09       
n/a 


                                                                                
                                                                                
                                                                                

Number of customers,       549.44   445.77    23.26% 2,033.43 1,644.43    
23.66%
million                                                                         
                                                                                


  convenience stores   497.07   415.46    19.64% 1,863.62 1,550.28    
20.21% 
                                                                             
        hypermarkets    39.47    26.81    47.22%   137.69    87.97    
56.53% 
                                                                             
       magnit family     4.34     0.82       n/a     8.87     2.20       
n/a 
                                                                             
    cosmetics stores     8.56     2.68       n/a    23.25     3.98       
n/a 


                                                                                



LFL Results
    LFL growth 4Q2012- 4Q 2011              Convenience stores  Hypermarkets  Total


                                                                           
Average ticket (excluding VAT), RUR           7.60%             6.19%     7.83% 
                                                                           
Traffic                                       0.38%             4.93%     0.62% 
                                                                           
Revenue, RUR                                  8.01%            11.43%     8.50% 


                                                                               
    LFL growth 12M 2012 to 12M 2011       Convenience stores  Hypermarkets   Total 


                                                                           
Average ticket (excluding VAT), RUR          5.73%            3.23%      5.63%  
                                                                           
Traffic                                     (0.46)%           2.07%     (0.35)% 
                                                                           
Revenue, RUR                                 5.25%            5.36%      5.26%  
                                                                            


    


2012 Key Financial Results
                     4Q 2012    4Q 2011   Growth      2012       2011     Growth  
                                        Rate                            Rate   


                                                                           
Net sales, mn    129,176.09 95,518.36  35.24%   448,661.13 335,699.95  33.65%  
RUR                                                                             


                                                                               
     convenience 102,481.13 79,660.18  28.65%   364,236.40 287,731.79  26.59%  
          stores                                                               
                                                                               
    hypermarkets 22,881.23  14,925.24  53.31%   75,418.70  46,185.07   63.30%  


                                                                            
magnit family  1,583.85   286.17      n/a     3,098.58    797.71      n/a    
                                                                           
cosmetics stores  2,207.63   628.66      n/a     5,732.51    892.82      n/a    


                                                                               
       wholesale   22.24      18.11    22.81%     174.93     92.55     89.01%  


                                                                           
Net sales, mnUS$  4,156.69  3,058.51   35.91%   14,429.65  11,423.26   26.32%   


                                                                               
     convenience  3,297.68  2,550.73   29.28%   11,714,42   9,790.99   19.64%  
          stores                                                               
                                                                               
    hypermarkets   736.28    477.91    54.06%    2,425.58   1,571.59   54.34%  


                                                                            
magnit family   50.97      9.16       n/a      99.66      27.14       n/a    
                                                                           
cosmetics stores   71.04      20.13      n/a      184.37     30.38       n/a    


                                                                               
       wholesale    0.72      0.58     23.42%      5.63       3.15     78.64%  


                                                                           
Gross profit, mn 35,695.12  25,502.03  39.97%   118,994.62 81,663.45   45.71%  
RUR                                                                             
                                                                           
Gross profit, mn  1,148.61   816.58    40.66%    3,827.05   2,778.86   37.72%  
US$                                                                             
                                                                           
Grossmargin,%    27.63%     26.70%    n/a       26.52%       24.33%   n/a       
                                                                           
EBITDAR, mn RUR  17,688.50  12,386.08  42.81%   57,764.89  34,636.97   66.77%   
                                                                           
EBITDAR, mn US$    569.19    396.60    43.52%    1,857.81   1,178.63   57.62%   
                                                                           
EBITDARmargin, %   13.69%    12.97%      n/a      12.87%     10.32%      n/a    
                                                                           
EBITDA, mn RUR   14,631.03  10,317.10  41.81%   47,374.54  27,604.14   71.62%   
                                                                           
EBITDA, mn US$     470.80    330.35    42.51%    1,523.64    939.32    62.21%   
                                                                           
EBITDA margin, % 11.33%     10.80%    n/a       10.56%       8.22%    n/a       
                                                                           
EBIT, mn RUR     11,506.19  7,946.76   44.79%   36,108.55  19,624.21   84.00%   
                                                                           
EBIT, mn US$       370.25    254.46    45.51%    1,161.31    667.78    73.91%   
                                                                           
EBIT margin, %     8.91%      8.32%      n/a      8.05%      5.85%       n/a    
                                                                           
Net profit, mn    8,203.64  5,324.81   54.06%   24,994.79  12,303.84   103.15% 
RUR                                                                             
                                                                           
Net profit, mn     263.98    170.50    54.83%     803.87     418.68    92.00%  
US$                                                                             
                                                                           
Net profit       6.35%      5.57%     n/a       5.57%        3.67%    n/a      
margin, %                                                                       


                                                                               
    Note: net revenue in US$ terms is calculated using the daily exchange rate.
    For further information, please contact:
    

Timothy Post     Director, Investor Relations                                  
                                                                               
                 e-mail: Post@gw.tander.ru                                     
                                                                               
                 Tel. in Krasnodar +7 (861) 277-45-54, 210-98-10 ext. 7600     
                                                                               
                 Mob.: +7 (961) 508-06-61                                      
                                                                               
                 Direct line for investors only: +7 (861) 277-45-62            


                                                                           
Dina Svishcheva  Deputy Director, Investor Relations                            


                                                                               
                 e-mail: Chistyak@gw.tander.ru                                 
                                                                               
                 Tel. in Krasnodar +7 (861) 277-45-54, 210-98-10 ext. 5101     
                                                                               
                 Mob.: +7-961-511-02-02                                        
                                                                               
                 Direct line for investors only: +7 (861) 277-45-62            
                                                                               
    Company description:

Headquartered in the southern Russia city of Krasnodar, Magnit (LSE and MICEX:
MGNT) is the holding company for a group of entities that operate in the retail
trade under the "Magnit" brand. The chain of "Magnit" stores is one of the
leading food retail networks in Russia. As of December 31, 2012 the chain
consisted of 6,046 convenience stores, 126 hypermarkets, 20 "Magnit Family"
stores and 692 cosmetics stores (drogerie) in 1,605 cities and towns throughout
the Russian Federation.


Approximately two-thirds of the Magnit's stores are located in cities with a
population of less than 500,000 inhabitants. Most of its stores are located in
the Southern, North-Caucasian, Central and Volga regions. The Company also
operates stores in the North-Western, Urals and Siberian regions. 
As of December 31, 2012 Magnit operated an in-house logistics system consisting
of 18 distribution centers, employing automated stock replenishment systems and
a fleet of 4,401 vehicles. 
In accordance with the unaudited IFRS management accounts for 2012, Magnit
recorded consolidated revenues of approximately $14,430 billion USD and a
consolidated EBITDA of $1,524 million USD. 
According to management accounts 
Based on the average exchange rate for 4Q 2012 of 31.0767 RUB per 1 USD, 4Q
2011 - 31.2304 RUB per 1 USD, 12М 2012 - 31.0930 RUB per 1 USD, 12M 2011 -
29.3874 RUB per 1 USD 
 On May 14, 2012 the Company announced the reformatting of 5 hypermarkets to
Magnit Family stores. Detailed information can be obtained from the
press-release http://www.magnit-info.ru/upload/iblock/f08/
f081571bdef1933b951446680a26bf40.pdf 
Based on 3,833 convenience stores which were opened by April 1, 2011, and 50
hypermarkets which were opened by February 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 
Based on 2,465 convenience stores which were opened by July 1, 2010, and 25
hypermarkets which were opened by May 1, 2010, 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 
END 
-0- Jan/22/2013 07:00 GMT
 
 
Press spacebar to pause and continue. Press esc to stop.