7 Feb 2019 07:00
MAGNIT PJSC (MGNT) PJSC 'Magnit' Announces Positive Like-For-Like Sales and Almost 10% Sales Growth in 4Q 2018 07-Feb-2019 / 10:00 MSK Dissemination of a Regulatory Announcement that contains inside information according to REGULATION (EU) No 596/2014 (MAR), transmitted by EQS Group. The issuer is solely responsible for the content of this announcement.
Press Release | Krasnodar | February 07, 2019
PJSC "Magnit" Announces Positive Like-For-Like Sales and Almost 10% Sales Growth in 4Q 2018
Krasnodar, Russia (7 February, 2019): Magnit PJSC (MOEX and LSE: MGNT), one of Russia's leading retailers announces its unaudited 4Q and FY 2018 results prepared in accordance with IFRS1.
Revenue increased by 9.7% from 302 billion RUR in 4Q 2017 to 332 billion RUR in 4Q 2018 on the back of significant LFL sales improvement to 0.6% compared to -2.0% in the previous quarter. This was the first quarter in 2 years with positive LFL sales as a result of improved CVP, changes in category management and increased availability on the shelf. LFL sales growth in the key format turned positive to 0.3% as average ticket growth outweighed still negative traffic. This was mainly driven by sound positive assortment mix and inflation. The best performance was demonstrated by "Magnit Cosmetic" stores - LFL sales growth reached 6.5% in 4Q 2018 on the back of 4.9% LFL average ticket growth and 1.5% traffic growth. Magnit supermarkets' LFL sales growth remained negative although improved from -1.6% in 3Q 2018 to -0.7% in 4Q. During 2018 Magnit added (net) 2,049 stores (1,302 convenience stores, 731 drogerie stores and 16 supermarkets). The total store base as of December 31, 2018 reached 18,399 stores. Addition of selling space in 2018 was 669 thousand sq. m. compared to 687 thousand sq. m. in 2017. The new CVP for the convenience format has been finalized and new stores will be opened under this new CVP with improved layout. The quality of new store openings has improved which supported sales density growth. We have redesigned 462 stores in 4Q 2018. As a result, we fulfilled the guidance for the year 2018. EBITDA in 4Q 2018 increased by 4.3% y-o-y on the back of EBITDA margin of 7.0%. EBITDA result was driven by the gross profit dynamics, increase of the lease expense due to the higher share of leased stores. Negative impact was partially offset by the improvement of payroll expenses through productivity increase in stores and energy consumption measures resulting in utilities costs reduction. Net Income in 4Q 2018 increased by 7.1% from 7.9 billion RUB in 4Q 2017 to 8.4 billion RUB in 4Q 2018. EBITDA margin contraction was almost neutralized due to improvement of interest expenses as a result of improvements of terms in the debt portfolio. Net Income Margin in 4Q 2018 was 2.5%.
Olga Naumova, Magnit's Chief Executive Officer, commented:
"We are proud to report positive like-for-like sales growth in the 4th quarter for the first time in 2 years. We are delighted that customers have reacted fast to the transformation we started six months ago, helping to grow sales almost 10% in the 4th quarter.
With these positive trends and our completed management team we feel very confident about 2019".
LFL Results:
4Q 2018 - 4Q 20174
12М 2018 - 12М 20174
4Q and 12M 2018 Key Financial Results, million RUR
Key Financial Position Statements as of 31.12.2018, million RUR
Notes: 1. This announcement contains inside information which is disclosed in accordance with the Market Abuse Regulation which came into effect on 3 July 2016. 2. Please note that there may be small variations in calculation of totals, subtotals and/ or percentage change due to rounding of decimals.
For further information, please contact:
Dmitry Kovalenko Director for Investor Relations Email: kovalenko_dv3@magnit.ru Office: +7-861-277-45-54, 210-9810 x 46082
Media Inquiries Media Relations Department Email: press@magnit.ru
Note to editors: Public Joint Stock Company "Magnit" is one of Russia's leading retailers. Founded in 1994, the company is headquartered in the southern Russian city of Krasnodar. As of December 31, 2018, Magnit operated 37 distribution centers and 18,399 stores (13,427 convenience, 467 supermarkets and 4,505 drogerie stores) in 2,976 cities and towns throughout 7 federal regions of the Russian Federation. In accordance with the unaudited IFRS management accounts for 2018, Magnit had revenues of RUB 1,237 billion and an EBITDA of RUB 90 billion. Magnit's local shares are traded on the Moscow Exchange (MOEX: MGNT) and its GDRs on the London Stock Exchange (LSE: MGNT) and it has a credit rating from Standard & Poor's of BB.
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| ISIN: | US55953Q2021 |
| Category Code: | MSCU |
| TIDM: | MGNT |
| LEI Code: | 2534009KKPTVL99W2Y12 |
| OAM Categories: | 2.2. Inside information |
| Sequence No.: | 7401 |
| EQS News ID: | 773487 |
| End of Announcement | EQS News Service |
UK Regulatory announcement transmitted by DGAP - a service of EQS Group AG. The issuer is solely responsible for the content of this announcement.