Magnit Says December Sales Rose 35% Amid Record Store OpeningsIlya Khrennikov
OAO Magnit, Russia’s largest food retailer by market value, said December sales increased 35 percent because of new store openings and an increase in the average amount spent by each customer.
Sales were 51.8 billion rubles ($1.7 billion), the Krasnodar, Russia-based company said in a regulatory filing. Full-year revenue rose 34 percent to 448 billion rubles, outpacing a Russian retail market that grew 6 percent in the year through November, according to the state’s statistics service.
Magnit said it opened 407 stores in December, bringing its total to 6,884. The monthly increase is the biggest in the fast-growing company’s history, according to analysts at VTB Capital. Two-thirds of its shops are in small cities with a population of less than 500,000 as the company expands into under-developed parts of the Russian regions, the retailer said.
Average ticket, or the amount spent per customer, rose 7.8 percent in the fourth quarter and 5.6 percent in 2012, the company said.
Magnit, founded and run by billionaire Chief Executive Officer Sergey Galitskiy, advanced 82 percent in 2012, the best performer in the MSCI Russia Index. Competitor X5 Retail Group declined 22 percent over the period. Magnit’s market value touched $20 billion earlier this month.
The strong results are “unlikely to cause a stir in the market,” Maria Kolbina, an analyst at VTB Capital, said in a note today. Magnit’s stock is trading at an enterprise value of 12.9 times forecast 2013 earnings before interest, taxes, depreciation and amortization, which implies a premium to peers in Turkey and other emerging markets, Kolbina wrote.