Russia's Magnit Sees Revenue Up 8.2%, Driven By Expansion
Russian retailer Magnit has posted a 8.2% increase in revenue to RUB 1,237 billion (€16.7 billion) in full-year 2018, with the operator increasing its store estate by 11.6% over the year.
Like-for-like sales at the retailer dropped 2.5%, comprised of a 0.1% increase in average basket sales, and a 2.6% decline in traffic.
Like-for-like performance did 'demonstrate positive dynamics towards the end of the year', however, the retailer said.
EBITDA for the year stood at RUB 89.9 billion, while full-year EBITDA margin was 7.3%.
"Despite the challenging macro environment of 2018 with slow macro growth and stagnating consumer purchasing power we were able to post a top line 8.2% growth for the full year, an EBITDA margin of 7.3% for 2018 and first indications of LFL growth in the fourth quarter of the year," said Olga Naumova, Magnit’s chief executive.
"These results give us a solid base for our transformation program for this year and allowed us to pay dividends as well as launch a significant share buyback program, which was successfully concluded in March this year."
In November, Magnit acquired pharmaceutical brand SIA Group, with a view to improving the performance efficiency of its Magnit Cosmetic and Magnit Pharmacy brands. The acquisition contributed RUB 2 billion worth of revenue to its full-year figures.
"This transaction was very important as we were able to acquire a solid platform enabling our rapid growth of the highly profitable Magnit Cosmetics format and the launch of our Magnit Pharmacy format," Naumova added.
"I am delighted to say the initial integration of SIA into Magnit and pilots have gone in line with plans been and now over 2,000 cosmetic stores or around 50% of the total shops are already serviced through the platform and the launch of our planned 2,000 pharmacies has commenced successfully."
© 2019 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.