Russia’s O’Key Group has posted a 4.1% increase in gross profit in the first half of the year. Revenue at the group was up 2.7% to RUB 86 billion.
Revenue in the group’s hypermarket and supermarket segment remained unchanged year-on-year, at RUB 81.26 billion, with ‘negative trends’ in the first quarter offset by a stronger second quarter.
The group posted a net loss of RUB 1.48 billion for the period, which was mainly due to the closure of inefficient stores and related write offs, it said.
Focus On Cost Control
“During the reporting period, we remained focused on costs control, optimisation of commercial policies and improvement of our assortment mix,” said Miodrag Borojevic, Chief Executive Officer of the hypermarket and supermarket segment.
“As a result of process optimisation, we achieved a notable decrease in personnel costs, both at store and head office level. We have identified a number of opportunities to further increase efficiency of our operations and expect this trend to continue going forward. The new approach to promotion and category management will help us improve overall LFL performance in 2H 2017.”
The period saw structural changes to the management team at O’Key Group, with the appointment of a new commercial and marketing director, Ivan Dropuljic, as well as a new new IT director, Tariel Bokuchava.
Borojevic added that the company remains “confident in our strategy, aimed at unlocking of our hypermarkets and supermarkets potential, and reiterate our guidance (7-8% EBITDA margin in the next three years and revenue low single digit growth in 2017).”
© 2017 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up for ESM: The European Supermarket Magazine.