OJSC MAGNIT: 1Q 2013 Results

Press-release 
Krasnodar 
April 23, 2013 
OJSC "Magnit" announces 1Q 2013 results 
Krasnodar, April 23, 2013: OJSC "Magnit", Russia's largest retailer (the
"Company", MICEX and LSE: MGNT), is pleased to announce its unaudited 1Q 2013
financial results prepared in accordance with IFRS. 
During 1Q 2013 the Company added (net) 191 stores (163 convenience stores, 6
hypermarkets, 1 "Magnit Family" and 21 cosmetics stores) and increased its
selling space by 29.88% in comparison to 1Q 2012 from 2,024.90 thousand sq. m.
to 2,629.88 thousand sq. m. The total store base as of March 31, 2013 reached
7,075 stores (6,209 convenience stores, 132 hypermarkets, 21 "Magnit Family"
and 713 cosmetics stores). 
Revenue in rubles increased by 30.43% YoY from 100,617.96 million RUR in 1Q
2012 to 131,239.91 million RUR in 1Q 2013. The top line growth was due to an
increase in selling space as well as to a 4.83% increase of like-for-like sales
(excl. VAT). Revenue growth in dollar terms amounted to 29.79%: from US$
3,324.65 million to US$ 4,315.09 million. 
Gross margin grew from 25.28% in 1Q 2012 to 26.72% in 1Q 2013. Gross profit in
rubles increased by 37.86% from 25,438.21 million RUR (US$ 840.54 million) to
35,070.35 million RUR (US$ 1,153.09 million). 
EBITDA increased by 25.78% from 9,710.48 million RUR (US$ 320.86 million) in 1Q
2012 to 12,214.09 million RUR (US$ 401.59 million) in 1Q 2013. EBITDA margin in
1Q 2013 amounted to 9.31%. 
1Q 2013 net income increased by 28.99% and amounted to 6,156.16 million RUR
(US$ 202.41 million) vs. 4,772.44 million RUR (US$ 157.69 million) in 1Q 2012. 
As has been noted previously, the month of February 2012 occurred during a
"leap year" and thus, there were 29 days (i.e. an extra day). February 2013, on
the other hand, occurred during a "normal year" in which there were only 28
days.  
This very same "leap year" effect/adjustment should also be calculated when one
makes the comparison between 1Q 2012 numbers vs. 1Q 2013 numbers. 
Therefore, in order to fairly compare the 1Q 2012 results to the 1Q 2011
results an amount of 1.47% should be subtracted for the 1Q 2012, which would
then equal 32.60%. To compare the 1Q 2013 results with the 1Q 2012 results
correctly, an amount of 1.45% should be added, which would then equal 31.88%. 
Sergey Galitskiy, the Company's CEO, provided the following comments on the
published results: 
"Last year was the strongest year in the Company's history. However, comparing
1Q 2013 results y-o-y we see that most of the changes are due to foreign
exchange difference, which speaks for the sustainability of the Company's
operating efficiency". 
1Q 2013 Key Operating Results 
                                    1Q 2013      1Q 2012    Growth Rate   
                                                                         
Number of opened stores, NET                    191        157            n/a 


                                                                             
                 convenience stores             163         98            n/a
                                                                             
                       hypermarkets               6          1            n/a
                                                                             
                      magnit family               1          2            n/a
                                                                             
                   cosmetics stores              21         56            n/a


                                                                         
Total number of stores                        7,075      5,466            n/a 


                                                                             
                 convenience stores           6,209      5,104            n/a
                                                                             
                       hypermarkets             132         91            n/a
                                                                             
                      magnit family              21          5            n/a
                                                                             
                   cosmetics stores             713        266            n/a


                                                                         
Selling space, thousand sq. m.             2,629.88   2,024.90         29.88% 


                                                                             
                 convenience stores        2,030.20   1,673.48         21.32%
                                                                             
                       hypermarkets          407.46     282.10         44.44%
                                                                             
                      magnit family           25.81       6.20            n/a
                                                                             
                   cosmetics stores          166.41      63.12            n/a


                                                                         
Number of customers, million                 563.01     462.04         21.85% 


                                                                             
                 convenience stores          505.46     427.82         18.15%
                                                                             
                       hypermarkets           42.13      29.39         43.32%
                                                                             
                      magnit family            5.58       0.87            n/a
                                                                             
                   cosmetics stores            9.85       3.96            n/a

LFL results

LFL growth 1Q 2013 - 1Q 2012     Convenience     Hypermarkets        Total     
                                    stores                                     


                                                                           
Average ticket (excluding           5.31%            3.19%           5.42%     
VAT), RUR                                                                       
                                                                           
Traffic                            (0.80)%           3.77%          (0.55)%     
                                                                           
Revenue, RUR                        4.46%            7.08%           4.83%      
1Q 2013 Key Financial Results 
                                   1Q 2013        1Q 2012     Growth Rate   
                                                                           
Net sales, mn RUR                       131,239.91    100,617.96         30.43% 


                                                                               
                 convenience stores     104,145.23     83,658.79         24.49%
                                                                               
                       hypermarkets      22,670.89     15,680.27         44.58%
                                                                               
                      Magnit Family       1,935.79        301.57            n/a
                                                                               
                   cosmetics stores       2,465.97        952.80        158.81%
                                                                               
                          wholesale          22.04         24.54       (10.17%)


                                                                           
Net sales, mn US$                         4,315.09      3,324.65         29.79% 


                                                                               
                 convenience stores       3,424.23      2,764.28         23.87%
                                                                               
                       hypermarkets         745.40        518.11         43.87%
                                                                               
                      Magnit Family          63.65          9.96            n/a
                                                                               
                   cosmetics stores          81.08         31.48        157.54%
                                                                               
                          wholesale           0.72          0.81       (10.61%)


                                                                           
Gross profit, mn RUR                     35,070.35     25,438.21         37.86% 
                                                                           
Gross profit, mn US$                      1,153.09        840.54         37.18% 
                                                                           
Gross margin, %                             26.72%        25.28%            n/a 
                                                                           
EBITDAR, mn RUR                          15,541.62     11,937.34         30.19% 
                                                                           
EBITDAR, mn US$                             511.00        394.44         29.55% 
                                                                           
EBITDAR margin, %                           11.84%        11.86%            n/a 
                                                                           
EBITDA, mn RUR                           12,214.09      9,710.48         25.78% 
                                                                           
EBITDA, mn US$                              401.59        320.86         25.16% 
                                                                           
EBITDA margin, %                             9.31%         9.65%            n/a 
                                                                           
EBIT, mn RUR                              8,969.84      7,134.03         25.73% 
                                                                           
EBIT, mn US$                                294.92        235.72         25.11% 
                                                                           
EBIT margin, %                               6.83%         7.09%            n/a 
                                                                           
Net profit, mn RUR                        6,156.16      4,772.44         28.99% 
                                                                           
Net profit, mn US$                          202.41        157.69         28.36% 
                                                                           
Net profit margin, %                         4.69%         4.74%            n/a 
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) 511-76-78                                   
                                                                               
                    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 Russian city of Krasnodar, Magnit (LSE and MICEX:
MGNT, S&P: "BB") 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 the
largest food retail network in Russia. As of March 31, 2013 the chain consisted
of 6,209 convenience stores, 132 hypermarkets, 21 "Magnit Family" stores and
713 cosmetics stores (drogerie) in 1,647 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 March 31, 2013 Magnit operated an in-house logistics system consisting of
18 distribution centers, employing automated stock replenishment systems and a
fleet of 4,448 vehicles.

In accordance with the audited IFRS consolidated financial statements for 2012,
Magnit recorded consolidated revenues of approximately $14,430 million USD and
a consolidated EBITDA of $1,524 million USD.

According to management accounts

Based on the average exchange rate for 1Q 2013 - 30.4142 RUR per 1 USD, 1Q 2012
- 30.2642 RUR per 1 USD

Based on 4,087 convenience stores which were opened by July 1, 2011, and 60
hypermarkets 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



END

-0- Apr/23/2013 06:00 GMT


 
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