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Russia's X5 Retail Group Sees Like-For-Like Sales Up 4.0% In Full Year

By Steve Wynne-Jones
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Russia's X5 Retail Group Sees Like-For-Like Sales Up 4.0%  In Full Year

Russian retail conglomerate X5 Retail Group has posted a 4.0% increase in like-for-like sales in its full year 2019.

Net retail sales increased by 13.3%, to RUB 1.53 trillion (€22.3 billion), for the year, with a 12% increase in selling space contributing 9.3% of sales growth.

Performance By Brand

The group's Pyaterochka banner posted a 3.7% increase in like-for-like sales for the period, including a 1.9% increase in traffic and a 1.8 increase in basket. The banner posted a net retail sales gain of 14.1% for the year.

On Pyaterochka's performance, X5 said that sales slowed sequentially in the fourth quarter of the year, due to a slower pace of openings and due to the impact of food inflation.

Its Perekrestok banner, meanwhile, saw a 7.3% increase in like-for-like sales, driven by a 5.0% traffic increase and a 2.3% increase in basket size. Perekrestok's net retail sales were up 18.3% for the year, with shoppers valuing the banner's customer value proposition, X5 said in a statement.

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Lastly, the group's Karusel banner saw a 0.3% decline in like-for-like sales, largely driven by a traffic decrease of 4.5%. Average basket size was up 4.5%, however. Karusel's net retail sales were down 3.8% during the period, due to several stores being covered to other formats.

'Balanced Growth'

“In 2019, we have delivered on our strategy of balanced growth, expanding net retail sales by 13.3% thanks to a 12.0% rise in selling space and positive LFL sales and traffic performance from our core proximity and supermarket formats in each quarter of the year," commented X% chef executive Igor Shekhterman. "[The] beginning of the year started strong for X5 with LFL traffic being above 5% year-to-date.
“The company once again delivered strong LFL and net retail sales growth, further increasing market share and cementing X5’s market leadership. Our e-commerce operations more than tripled their net sales."

During the year, X5 introduced a number of new 'customer-centric' store concepts for its proximity and supermarket formats, which will be rolled out from this year.

"Initial results [from the new concept stores] have been above expectations, with double-digit LFL traffic growth," Shekhterman added.

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Slower Rate Of Growth

In 2019, X5 opened a net 1,866 new stores, compared to 2,310 stores in full-year 2018.

As part of its ongoing rationalisation programme, some 224 proximity stores, 16 supermarkets and five hypermarkets were closed.

In addition, the business opened three new distribution centres, boasting a total space of 81 thousand square metres, with the latest centre, in Kazan, opening in the fourth quarter.

Online, X5 continues to post solid growth, with the total number of orders through its Perekrestok.ru channel rising to 1.4 million in 2019, a three-fold increase on the previous year.

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“We will continue to grow our Pyaterochka and Perekrestok networks based on the new store concepts, expanding the use of big data-driven tools in areas like assortment and pricing, while remaining focused on putting our customers at the centre of every business decision," said Shekhterman.

© 2020 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.

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