Aug. 24 (Bloomberg) -- OAO Magnit, Russia’s second-largest food retailer, said it will increase spending to accelerate store openings as the country’s economy recovers from the worst slump on record.
Capital spending may reach $1.3 billion this year, 30 percent more than the company forecast in March, as it seeks to open almost two stores a day, Magnit said today in a statement. The company, based in Krasnodar, southern Russia, plans to open 650 stores and 30 hypermarkets in 2010.
Russia’s July retail sales surged the most since November 2008, signaling recovery from last year’s 7.9 percent economic contraction. Gross domestic product expanded 5.2 percent in the second quarter.
The first-half results “instill optimism and confidence in the targeted sales growth of 35 percent in ruble terms” this year, billionaire Chief Executive Officer Sergei Galitsky said in the statement.
Magnit added 260 stores and four hypermarkets in the first half, pushing its store count to 3,492. Sales rose 32 percent in the period to 103.7 billion rubles ($3.38 billion), while net income gained 1.2 percent to 3.95 billion rubles.
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