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Magnit Reports 6.9% LFL Sales Growth and 7.2% EBITDA margin

·29-min read

MAGNIT PJSC (MGNT)
29-Oct-2020 / 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.

Magnit Reports 6.9% LFL Sales Growth and 7.2% EBITDA margin

 

Krasnodar, Russia (29 October, 2020): Magnit PJSC (MOEX and LSE: MGNT; the Company), one of Russia's leading retailers, announces its 3Q and 9M 2020 operating and unaudited financial results.

 

3Q 2020 key operating and financial highlights:

 

 

Jan Dunning, President and CEO of Magnit, commented:

"In the environment of unprecedented challenges, we continued being absolutely committed to key business priorities, while making customers' safety and satisfaction a centric one.

We are pleased with the third quarter results that came above our expectations despite macro headwinds. We see gradual normalization of consumer shopping behaviour with traffic recovery and stabilization of the basket growth. We have again delivered strong LFL sales growth thanks to consistent qualitative improvements in the stores. Strong momentum continues in October with some acceleration of LFL sales growth boding well for the fourth quarter.

We observe further progress in efficiency improvement of our stores - strong returns across all out formats and regions. We are gradually resuming our expansion and redesign programs and expect further acceleration in the next periods with continued focus on returns.

Even though direct positive impact of pandemic on top-line is diminishing, but we still bear COVID-related expenses, our sales remains solid and profitability continues gaining traction with the largest y-o-y expansion among three quarters of this year. Strong sales and EBITDA coupled with the first working capital improvements bodes well for higher cash flow generation and further deleveraging. With that we will jump into the next year with completely different financial position and ambitions".

Key events in 3Q 2020 and after the reported period:

 

 

3Q and 9M 2020 Operating Results

3Q and 9М 2020 LFL results

3Q 2020

 

9М 2020[6]

 

 

Trading performance

Total sales in 3Q 2020 grew by 11.9% y-o-y to RUB 383.2 billion.

Net retail sales in 3Q 2020 grew by 11.4% y-o-y driven by a combination of 3.2% selling space growth and 6.9% LFL sales growth. For a third consecutive quarter, net retail sales growth outpaced selling space growth as strong LFL results have led to a continuous improvement of sales densities since January 2020. Overall sales densities in 3Q 2020 improved by 1.4% q-o-q and 3.6% y-o-y while in the Company's main convenience store format they improved by 5.4% y-o-y.

All operating regions showed solid positive LFL sales growth with the North-West, Siberia and Moscow outpacing the rest.

LFL sales growth in 3Q 2020 remained almost in line with the Company's 2Q 2020 result and well above CPI. Mature stores continue to be the main driver of the Company's strong LFL performance with only 607 stores (incl. 299 convenience and 308 drogeries) entering LFL panel in 3Q. Only 5% of Magnit's selling space is currently in the ramp-up phase with 95% already matured.

As in the previous quarter, average ticket was the main driver of LFL sales growth. This reflects continued trend of lower frequency of visits overcompensated by strong basket growth driven by increased spending per visit.

LFL average ticket growth in 3Q 2020 was 12.4% predominantly due to customers 'trading up' purchases and higher on-shelf inflation. The number of articles per basket, which was the main driver in the previous quarter, started easing from July.

 

This was combined with gradual recovery in customer traffic from -14.0% in 2Q 2020 to -4.9% in the reported quarter reflecting continued normalization of shopping behaviour.

Promo intensity was still lower y-o-y mainly on the back of more normal shopping patterns and different marketing tactics leading to a shift from "bulk" to personalized actions. The level of promo was moderately higher q-o-q due to seasonal factors.

In the second half of September the sales of dry and non-food categories started to pick up, however sales were a tenth of the levels seen in March. The impact of the pandemic on the consumer behaviour is now insignificant as customers are taking a more rational approach to forward buying of non-perishable goods.

Magnit's cross-format loyalty program continued to gain popularity among customers during the period. Over 75 million cards have been issued since the start of the pilot in March 2019 with the number of active users approaching 39 million. Company-wide, the share of tickets using the loyalty card was 50% with penetration in sales reaching 67%. The loyalty program is delivering positive cross-format gains with sustainable growth of customers visiting 2+ store formats (over 40% of Magnit customer base at the end of 3Q).

 

Store network development and performance by format

The convenience segment generated 76.7% of total net retail sales in the reported quarter. In 3Q 2020 Magnit resumed its expansion program and opened (gross) 187 convenience stores compared to 94 in 2Q 2020. The Company continued its efficiency campaign and closed 69 convenience stores - less than in 2Q (107) and less than originally planned as some stores demonstrated significant operational improvements and were excluded from the closure pipeline. As a result, Magnit added 118 stores (net) during 3Q 2020, bringing the total number of convenience stores to 14,699. The selling space of convenience stores increased by 2.1% y-o-y to 5,005 thousand sq. m. as of September 30, 2020. Sales in the convenience format grew by 11.9% driven by LFL sales growth of 7.8% in 3Q 2020. Traffic across this segment demonstrated gradual recovery from -14.3% in the previous quarter to -5.0% in 3Q 2020 as restrictions had been lifted and customers started to resume their normal shopping patterns. LFL average ticket growth remained strong having normalized from 26.3% in 2Q 2020 to 13.6% in 3Q 2020 and overcompensating negative LFL traffic growth.

Supermarkets accounted for 13.1% of the Group's net retail sales. During the reported quarter the total number of supermarkets decreased by three stores to 469 following one store opening and four closures. Selling space across this format remained almost flat y-o-y and stood at 940 thousand sq. m. The supermarket segment is the most affected segment in the pandemic environment as customers continue to prefer convenience stores to larger formats, especially those located in the shopping malls. Magnit's standalone supermarkets demonstrate better recovery trends compared to the Company's 168 stores that are in shopping centers. LFL traffic remained negative but recovered from -20.2% in the previous quarter to -11.3% in 3Q 2020 translating into a stabilization of LFL average ticket growth to 10.6%. As a result, supermarkets demonstrated negative LFL sales growth of 1.9%. Given almost flat selling space growth this resulted in negative sales growth of 1.2%. This year Magnit did not repeat the coupon campaign launched in 3Q 2019 in the large formats as despite generating additional traffic and ticket expansion, this campaign had a negative impact on profitability last year. Nowadays Magnit is exploring alternative promo formats aimed at higher promo efficiency, including additional bonuses for every RUB 1,000 spent in supermarkets, progressive bonus system, and canvassing of convenience store customers.

The share of drogerie format as a proportion of the total net retail sales continued to expand and reached 9.4% in the reported quarter. During 3Q 2020 Magnit opened (net) 145 cosmetics stores (compared to 336 in 3Q 2019) and added 34 thousand sq. m. of selling space delivering an 8.1% increase in selling space, the highest increase across all formats. Driven by this increase in selling space and LFL sales growth of 12.6%, sales grew 21.8% representing the strongest performance among all Magnit's store formats and an acceleration from the 2Q 2020 level of 9.3%. LFL traffic growth improved significantly from -2.5% to a positive territory at 2.5%. Traffic recovery did not lead to softer LFL average ticket growth - it remained strong at 9.8% growth.

During 3Q 2020 three convenience stores and three supermarkets were redesigned resulting in the combined share of refurbished and new stores at: 71% for convenience stores, 25% for supermarkets and 55% for the drogerie format. For more information on FY 2020 forecast - see guidance section.

 

 

3Q 2020 Monthly Operating Results

 

 

Net retail sales growth in each month of the third quarter demonstrated gradual deceleration in line with selling space growth dynamics reflecting Company's decision to slowdown expansion focusing on improvements in the mature stores. July was the strongest month of the third quarter with 14.3% sales growth - almost in line with April and above the 2Q average. Strong July results were mainly driven by government payments stimulating consumption as well as later start of the domestic tourist season and limited foreign travel.

Absolute traffic growth (number of tickets) remained negative but demonstrated gradual recovery compared to the previous quarter with July delivering positive traffic growth on the back of normalizing frequency of visits and continued growth of unique customers gained from other players - mainly traditional retailers and large formats.

LFL ticket growth has been normalizing throughout the reported quarter but remained strong. Trading up effect driven by assortment and on-shelf availability improvements, shelf-price inflation and volume growth remained the key elements of solid average ticket development.

 

Financial results for 3Q and 9M 2020 (IAS 17)

 

 

Total revenue in 3Q 2020 increased by 11.9% to RUB 383.2 billion. Net retail sales in 3Q 2020 grew by 11.4% y-o-y to RUB 371.0 billion.

Wholesale revenue in 3Q 2020 increased by 27.2% y-o-y to RUB 12.2 billion. This accelerated rate of growth from 4.2% in the previous quarter was driven by a recovery of the HORECA demand after removal of restrictions, start of the tourist season and improvement in the wholesale pharmaceutical market after a slowdown in 2Q 2020. Wholesale revenue as a proportion of total revenue increased from 2.1% in 2Q 2020 to 3.2% in the reported quarter.

Gross Profit in 3Q 2020 increased by 18.5% to RUB 91.2 billion with a margin increase of 134 bps y-o-y to 23.8% as a result of improved commercial terms, lower promo activity in combination with better promo coverage and higher promo margin, lower shrinkage and reduced supply chain costs. This was partially offset by the ongoing investments into Magnit's loyalty program with higher penetration not yet compensated by suppliers. Format structure had a mixed impact on gross margin, with the share of high-margin drogerie business growing from 8.6% in 3Q 2019 to 9.4% in 3Q 2020 and the share of lower margin wholesale segment increasing as a % sales.

Despite continuous increase of on-shelf availability supply chain costs improved substantially y-o-y due to lower transportation costs and higher utilization.

Alongside with the growing share of fresh products and overall improvement of on-shelf availability shrinkage as a proportion of sales decreased further by 69 bps y-o-y driven by ongoing optimization of supply chain processes, renegotiation of quality standards with suppliers and other initiatives launched in 2019.

SG&A costs demonstrated solid improvement of 54 bps to 20.5% as a percent of sales. This was achieved as a result of lower depreciation, rent, marketing and other expenses as well as positive operating leverage effect.

Personnel costs as a percent of sales increased by 36 bps y-o-y driven by higher payments to retail personnel due to stronger sales offsetting productivity increase. Staff turnover continued to improve during the period driven by on-going automation of business processes and improved working conditions in the Company's stores including a selective increase in compensation for frontline employees as well as higher retention rate.

Rental costs as a percent of sales decreased by 40 bps y-o-y driven by higher sales density, improved lease terms with landlords, lower y-o-y store openings and closing of inefficient stores. This was achieved despite the increased share of leased selling space to 77.6% in 3Q 2020 vs 76.8% a year ago.

Depreciation as a percent of sales reduced by 45 bps y-o-y driven by operating leverage and slower expansion. During the reported quarter, Magnit renovated only six stores in total compared to 639 stores over the corresponding period of last year.

Lower promo intensity and smarter marketing strategies on the back of low promo sensitivity of customers and softer competition resulted in the continued reduction of advertising expenses y-o-y.

The 25 bps y-o-y growth in utilities costs was primarily driven by a country-wide increase in tariffs, including annual indexation of electricity costs and an increase in cleaning expenses due to higher frequency of cleaning and sanitary treatment.

Packaging and raw materials expenses increased by 15 bps y-o-y reflecting the ongoing provision of means of sanitary protection to customers and employees during the COVID-19 pandemic.

Total costs incurred as a result of the Company's response to COVID-19 in 3Q 2020 amounted to approximately RUB 0.5 billion. This included additional payments to frontline personnel (reflected in staff costs), and safety procedures (reflected in other operating expenses).

As a result, EBITDA was RUB 27.6 billion with 7.2% margin - the largest y-o-y expansion across three quarters of this year (a 133 bps increase) due to strong gross margin dynamics and lower SG&A expenses. LTI expenses in the reported period stood at 0.08% of sales - as a result EBITDA margin pre-LTI was 7.3%.

EBITDA margin in 3Q 2020 was lower than that for 2Q 2020 predominantly due to negative q-o-q operational leverage effect (lower absolute sales), seasonal product mix effect (higher share of low-margin product categories in average basket) and moderately higher q-o-q promo activity in the market.

Net finance costs in 3Q 2020 decreased by 11.4% y-o-y (or 23 bps as a percent of sales) to RUB 3.4 billion due to the lower cost of debt. As a result of continued focus on financial efficiencies, the cost of debt further reduced to 6.17% (156 bps y-o-y or 13 bps q-o-q). This has also led to further improvement of the debt profile with increased share of long-term borrowings to 98% and longer debt maturity from 21 months to 23 months.

In 3Q 2020 the Company reported FX losses in the amount of RUB 0.9 billion related to direct import operations.

Income tax in 3Q 2020 was RUB 2.9 billion. Effective tax rate has normalized to 23.5%.

As a result, net income in 3Q 2020 increased by 174.1% y-o-y and stood at RUB 9.6 billion. Net income margin increased by 149 bps y-o-y to 2.5%.

 

Financial results for 3Q and 9M 2020 (IFRS 16)

 

 

Balance Sheet and Cash Flows

 

Financial Position Highlights as of 30.09.2020 (IAS 17)

 

Despite ongoing improvement to on-shelf availability, the increased share of drogerie format to 9.4% of net retail sales and supplier inflation, inventories decreased by RUB 9.7 billion vs June 30, 2020 and stood at RUB 209.5 billion primarily due to a reduction of slow-moving items.

Trade and other payables increased by 3.1% or RUB 3.6 billion compared to June 30, 2020 and stood at RUB 121.3 billion as a result of improved supplier payment terms. This improvement was partially offset by the increase in accounts receivables by RUB 3.1 billion.

Working capital management remains one of the key priorities of the Company. A number of ongoing initiatives, including the optimization of receivables, electronic document flow, cross-functional projects aiming at reducing inventories, etc. will result in working capital improvements going forward predominantly through the reduction of inventory turnover in days.

 

Gross Debt decreased by RUB 24.8 billion or 11.9% compared to June 30, 2020 and stood at RUB 183.8 billion as of September 30, 2020 with cash position of RUB 5.5 billion. As a result, Net Debt reduced by RUB 9.1 billion compared to June 30, 2020 and stood at RUB 178.3 billion. The Company's debt is fully RUB denominated matching revenue structure. The Net Debt to EBITDA ratio was 1.8x as at 30 September 2020 vs 2.0x as at 30 June 2020.

Capex during 3Q 2020 decreased by 57.9% y-o-y to RUB 7.0 billion following a slowdown of expansion program (349 store openings on gross basis in 3Q 2020 vs 742 in 3Q 2019) and decelerated redesign program (6 stores in 3Q 2020 vs 639 stores in 3Q 2019). Total capital expenditure for the first nine months of 2020 stood at RUB 19.3 billion compared to RUB 38.9 billion in 9M 2019 (down by 50.5% y-o-y).

 

FY 2020 Guidance

Magnit confirms its full year store opening and redesign guidance published on 30 July 2020 adjusted as a result of the impact of the COVID-19 pandemic The Company expects an accelerated pace of expansion and renovation over the next periods.

The Company reduces its 2020 capital expenditures projections from RUB 45-50bn to RUB 35-40 billion to account for lower investments in expansion and redesign, economy gains from more efficient projects execution and slippage for 2021.

 

 

 

 

 

 

 

 

 

 

 

 

Note:

 

 

For further information, please contact:

 

 

Dmitry Kovalenko

Director for Investor Relations

Email: dmitry_kovalenko@magnit.ru

Office: +7 (861) 210-48-80

 

Dina Chistyak

Director for Investor Relations

Email: dina_chistyak@magnit.ru

Office: +7 (861) 210-9810 x 15101

 

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 September 30, 2020, Magnit operated 38 distribution centres and 21,154 stores (14,699 convenience, 469 supermarkets and 5,986 drogerie stores) in 3,819 cities and towns throughout 7 federal regions of the Russian Federation.

In accordance with the unaudited IFRS 16 management accounts results for 1H 2020, Magnit had revenues of RUB 763.4 billion and an EBITDA of RUB 86.9 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.

Forward-looking statements:

This document contains forward-looking statements that may or may not prove accurate. For example, statements regarding expected sales growth rate and store openings are forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause actual results to differ materially from what is expressed or implied by the statements. Any forward-looking statement is based on information available to Magnit as of the date of the statement. All written or oral forward-looking statements attributable to Magnit are qualified by this caution. Magnit does not undertake any obligation to update or revise any forward-looking statement to reflect any change in circumstances.

 

[1] LFL calculation base includes stores, which have been operating for 12 months since its first day of sales. LFL sales growth and average ticket growth are calculated based on sales turnover including VAT

[2] Convenience Stores include convenience stores and small pilots such as Magnit City and My Price

[3] Supermarkets include Magnit Family supermarkets and superstores

[4] Other Formats include pharmacies and stores located at Russian Post offices

[5] Excluding VAT

[6] Excluding leap year effect, i.e. based on trading results of February 1-28, 2020

[7] Excluding VAT

[8] Long-Term Incentive Program

[9] Long-Term Incentive Program


 

3Q 2020

3Q 2019

Change

Change, %

9M 2020

9M 2019

Change

Change, %

Total Net Retail Sales, million RUB

370,952

332,965

37,987

11.4%

1,114,910

975,976

138,934

14.2%

Convenience Stores[2]

284,552

254,239

30,313

11.9%

860,142

750,016

110,126

14.7%

Supermarkets[3]

48,663

49,263

-600

-1.2%

149,618

146,262

3,356

2.3%

Drogerie Stores

34,993

28,719

6,274

21.8%

97,275

78,477

18,798

24.0%

Other Formats[4]

2,744

745

2,000

268.5%

7,876

1,222

6,654

544.7%

Number of Tickets, mln

1,200

1,217

-17

-1.4%

3,486

3,472

14

0.4%

Convenience stores

1,006

1,028

-22

-2.1%

2,928

2,940

-13

-0.4%

Supermarkets

86

96

-10

-10.7%

254

284

-30

-10.6%

Drogerie Stores

99

90

10

10.8%

281

243

37

15.4%

Other Formats

8

3

6

205.7%

24

4

20

450.2%

Average Ticket[5], RUB

309

274

36

13.0%

320

281

39

13.8%

Convenience stores

283

247

36

14.4%

294

255

39

15.2%

Supermarkets

566

512

55

10.7%

590

515

75

14.5%

Drogerie Stores

353

321

32

10.0%

347

323

24

7.4%

Other Formats

325

259

65

25.1%

318

266

52

19.6%

Number of Stores (EOP)

21,154

20,497

657

3.2%

21,154

20,497

657

3.2%

Convenience Stores

14,699

14,507

192

1.3%

14,699

14,507

192

1.3%

Supermarkets

469

467

2

0.4%

469

467

2

0.4%

Drogerie Stores

5,986

5,523

463

8.4%

5,986

5,523

463

8.4%

Store Openings (Gross)

349

742

-393

-53.0%

847

2,520

-1,673

-66.4%

Convenience Stores

187

396

-209

-52.8%

426

1,426

-1,000

-70.1%

Supermarkets

1

3

-2

-66.7%

2

3

-1

-33.3%

Drogerie Stores

161

343

-182

-53.1%

419

1,091

-672

-61.6%

Store Closures

89

129

-40

-31.0%

418

371

47

12.7%

Convenience Stores

69

120

-51

-42.5%

349

346

3

0.9%

Supermarkets

4

2

2

100.0%

6

3

3

100.0%

Drogerie Stores

16

7

9

128.6%

63

22

41

186.4%

Store Openings (Net)

260

613

-353

-57.6%

429

2,149

-1,720

-80.0%

Convenience Stores

118

276

-158

-57.2%

77

1,080

-1,003

-92.9%

Supermarkets

-3

1

-4

-400.0%

-4

0

-4

n/a

Drogerie Stores

145

336

-191

-56.8%

356

1,069

-713

-66.7%

Total Selling Space (EOP), th. sq.m

7,371

7,143

228

3.2%

7,371

7,143

228

3.2%

Convenience Stores

5,005

4,900

105

2.1%

5,005

4,900

105

2.1%

Supermarkets

940

941

0

0.0%

940

941

0

0.0%

Drogerie Stores

1,384

1,280

104

8.1%

1,384

1,280

104

8.1%

Other Formats

42

22

19

85.7%

42

22

19

85.7%

Selling Space Addition (Net), th. sq.m

80

207

-127

n/a

132

718

-586

n/a

Convenience Stores

49

123

-74

n/a

53

456

-403

n/a

Supermarkets

-3

2

-5

n/a

-8

-1

-7

n/a

Drogerie Stores

34

72

-38

n/a

81

244

-163

n/a

Other Formats

1

11

-10

n/a

6

19

-14

n/a

LFL composition, %

Average Ticket

Traffic

Sales

Total

12.4%

-4.9%

6.9%

Convenience stores

13.6%

-5.0%

7.8%

Supermarkets

10.6%

-11.3%

-1.9%

Drogerie Stores

9.8%

2.5%

12.6%

LFL composition, %

Average Ticket

Traffic

Sales

Total

13.4%

-5.3%

7.3%

Convenience stores

14.4%

-5.5%

8.2%

Supermarkets

14.1%

-11.5%

1.0%

Drogerie Stores

7.3%

2.8%

10.3%

 

July

Change

August

Change

September

Change

Total net retail sales, RUB million

131,185

14.3%

124,207

10.7%

115,559

9.0%

Convenience Stores

100,978

14.7%

94,884

11.3%

88,689

9.6%

Supermarkets

17,356

3.2%

16,510

-2.2%

14,797

-4.9%

Drogerie Stores

11,965

23.5%

11,909

20.9%

11,119

21.1%

Other Formats

886

437.5%

904

269.3%

954

184.8%

Number of tickets, million

412

0.9%

401

-2.5%

386

-2.6%

Convenience stores

346

0.2%

336

-3.2%

324

-3.4%

Supermarkets

30

-9.2%

29

-11.5%

27

-11.5%

Drogerie Stores

33

13.0%

34

9.4%

32

10.0%

Other Formats

2.7

324.3%

2.8

212.0%

2.9

138.7%

Average ticket[7], RUB

318

13.4%

309

13.5%

299

12.0%

Convenience stores

292

14.5%

282

15.0%

274

13.5%

Supermarkets

583

13.7%

568

10.5%

547

7.5%

Drogerie Stores

358

9.3%

355

10.4%

345

10.1%

Other Formats

327

28.6%

318

24.9%

328

23.6%

Number of Stores (EOP)

20,900

n/a

20,971

n/a

21,154

n/a

Convenience stores

14,579

n/a

14,620

n/a

14,699

n/a

Supermarkets

469

n/a

470

n/a

469

n/a

Drogerie Stores

5,852

n/a 

5,881

n/a 

5,986

n/a 

Store Openings (Gross)

44

n/a

94

n/a

211

n/a

Convenience stores

25

n/a

58

n/a

104

n/a

Supermarkets

0

n/a

1

n/a

0

n/a

Drogerie Stores

19

n/a 

35

n/a 

107

n/a 

Store Closures

38

n/a

23

n/a

28

n/a

Convenience stores

27

n/a

17

n/a

25

n/a

Supermarkets

3

n/a

0

n/a

1

n/a

Drogerie Stores

8

n/a 

6

n/a 

2

n/a 

Store Openings (Net)

6

n/a

71

n/a

183

n/a

Convenience stores

-2

n/a

41

n/a

79

n/a

Supermarkets

-3

n/a

1

n/a

-1

n/a

Drogerie Stores

11

n/a 

29

n/a 

105

n/a 

Total Selling Space (EOP), th. sq. m.

7,290

4.0%

7,316

3.4%

7,371

3.2%

Convenience stores

4,956

2.8%

4,973

2.4%

5,005

2.1%

Supermarkets

941

0.4%

942

0.0%

940

0.0%

Drogerie Stores

1,352

9.4%

1,359

7.9%

1,384

8.1%

Other Formats

41

203.6%

41

130.6%

42

85.7%

Selling Space Added (Net), th. sq. m.

-0.4

n/a

26.0

n/a

54.7

n/a

Convenience stores

0.2

n/a

17.2

n/a

31.4

n/a

Supermarkets

-3.0

n/a

1.4

n/a

-1.7

n/a

Drogerie Stores

2.3

n/a 

7.0

n/a 

24.7

n/a 

Other Formats

0.2

n/a

0.3

n/a

0.3

n/a

million RUB

3Q 2020

3Q 2019

Change

9M 2020

9M 2019

Change

Total revenue

383,189

342,583

11.9%

1,146,550

1,000,499

14.6%

Retail

370,952

332,965

11.4%

1,114,910

975,976

14.2%

Wholesale

12,237

9,618

27.2%

31,640

24,523

29.0%

Gross Profit

91,180

76,930

18.5%

270,701

232,253

16.6%

Gross Margin, %

23.8%

22.5%

134 bps

23.6%

23.2%

40 bps

SG&A, % of sales

-20.5%

-21.0%

54 bps

-20.5%

-21.5%

98 bps

EBITDA pre LTI[8]

27,891

20,672

34.9%

81,461

64,690

25.9%

EBITDA Margin pre LTI, %

7.3%

6.0%

124 bps

7.1%

6.5%

64 bps

EBITDA

27,598

20,101

37.3%

80,819

63,144

28.0%

EBITDA Margin, %

7.2%

5.9%

133 bps

7.0%

6.3%

74 bps

EBIT

16,841

8,945

88.3%

46,978

28,718

63.6%

EBIT Margin, %

4.4%

2.6%

178 bps

4.1%

2.9%

123 bps

Net finance costs

-3,368

-3,802

-11.4%

-10,642

-11,244

-5.4%

FX gain / (loss)

-905

-55

n/a

-1,730

586

-395.3%

Profit before tax

12,567

5,088

147.0%

34,606

18,060

91.6%

Taxes

-2,948

-1,578

86.7%

-7,942

-4,966

59.9%

Net Income

9,620

3,509

174.1%

26,664

13,093

103.6%

Net Income Margin, %

2.5%

1.0%

149 bps

2.3%

1.3%

102 bps

million RUB

3Q 2020

3Q 2019

Change

9M 2020

9M 2019

Change

Total revenue

383,189

342,583

11.9%

1,146,550

1,000,499

14.6%

Retail

370,952

332,965

11.4%

1,114,910

975,976

14.2%

Wholesale

12,237

9,618

27.2%

31,640

24,523

29.0%

Gross Profit

91,180

76,930

18.5%

270,701

232,253

16.6%

Gross Margin, %

23.8%

22.5%

134 bps

23.6%

23.2%

40 bps

SG&A, % of sales

-18.9%

-19.6%

63 bps

-19.0%

-20.1%

111 bps

EBITDA pre LTI[9]

44,680

36,743

21.6%

131,921

111,813

18.0%

EBITDA Margin pre LTI, %

11.7%

10.7%

93 bps

11.5%

11.2%

33 bps

EBITDA

44,388

36,172

22.7%

131,278

110,267

19.1%

EBITDA Margin, %

11.6%

10.6%

103 bps

11.4%

11.0%

43 bps

EBIT

23,080

14,345

60.9%

64,882

42,962

51.0%

EBIT Margin, %

6.0%

4.2%

184 bps

5.7%

4.3%

136 bps

Net finance costs

-10,765

-11,994

-10.2%

-33,700

-35,545

-5.2%

FX gain / (loss)

-1,018

-41

n/a

-1,938

600

-423.1%

Profit before tax

11,297

2,310

389.0%

29,244

8,017

264.8%

Taxes

-2,693

-1,023

163.3%

-6,870

-2,958

132.3%

Net Income

8,603

1,287

568.4%

22,374

5,059

342.2%

Net Income Margin, %

2.2%

0.4%

187 bps

2.0%

0.5%

145 bps

Million RUB

30.09.2020

30.06.2020

Inventories

209,526

219,236

Trade and other receivables

13,038

9,949

Cash and cash equivalents

5,551

21,149

 

 

 

Long-term borrowings

150,733

117,389

Trade and other payables

121,280

117,654

Short-term borrowings and short-term portion of long-term borrowings

33,092

91,204

 

30 September 2020

30 June 2020

31 December 2019

30 September 2019

Gross Debt, RUB billion

183.8

208.6

184.2

175.3

Net Debt, RUB billion

178.3

187.4

175.3

168.7

Net Debt/EBITDA

1.8x

2.0x

2.1x

2.0x

 

3Q 2020

3Q 2019

Change

Change, %

9M 2020

9M 2019

Change

Change, %

Total Net Retail Sales, million RUB

370,952

332,965

37,987

11.4%

1,114,910

975,976

138,934

14.2%

Convenience Stores[2]

284,552

254,239

30,313

11.9%

860,142

750,016

110,126

14.7%

Supermarkets[3]

48,663

49,263

-600

-1.2%

149,618

146,262

3,356

2.3%

Drogerie Stores

34,993

28,719

6,274

21.8%

97,275

78,477

18,798

24.0%

Other Formats[4]

2,744

745

2,000

268.5%

7,876

1,222

6,654

544.7%

Number of Tickets, mln

1,200

1,217

-17

-1.4%

3,486

3,472

14

0.4%

Convenience stores

1,006

1,028

-22

-2.1%

2,928

2,940

-13

-0.4%

Supermarkets

86

96

-10

-10.7%

254

284

-30

-10.6%

Drogerie Stores

99

90

10

10.8%

281

243

37

15.4%

Other Formats

8

3

6

205.7%

24

4

20

450.2%

Average Ticket[5], RUB

309

274

36

13.0%

320

281

39

13.8%

Convenience stores

283

247

36

14.4%

294

255

39

15.2%

Supermarkets

566

512

55

10.7%

590

515

75

14.5%

Drogerie Stores

353

321

32

10.0%

347

323

24

7.4%

Other Formats

325

259

65

25.1%

318

266

52

19.6%

Number of Stores (EOP)

21,154

20,497

657

3.2%

21,154

20,497

657

3.2%

Convenience Stores

14,699

14,507

192

1.3%

14,699

14,507

192

1.3%

Supermarkets

469

467

2

0.4%

469

467

2

0.4%

Drogerie Stores

5,986

5,523

463

8.4%

5,986

5,523

463

8.4%

Store Openings (Gross)

349

742

-393

-53.0%

847

2,520

-1,673

-66.4%

Convenience Stores

187

396

-209

-52.8%

426

1,426

-1,000

-70.1%

Supermarkets

1

3

-2

-66.7%

2

3

-1

-33.3%

Drogerie Stores

161

343

-182

-53.1%

419

1,091

-672

-61.6%

Store Closures

89

129

-40

-31.0%

418

371

47

12.7%

Convenience Stores

69

120

-51

-42.5%

349

346

3

0.9%

Supermarkets

4

2

2

100.0%

6

3

3

100.0%

Drogerie Stores

16

7

9

128.6%

63

22

41

186.4%

Store Openings (Net)

260

613

-353

-57.6%

429

2,149

-1,720

-80.0%

Convenience Stores

118

276

-158

-57.2%

77

1,080

-1,003

-92.9%

Supermarkets

-3

1

-4

-400.0%

-4

0

-4

n/a

Drogerie Stores

145

336

-191

-56.8%

356

1,069

-713

-66.7%

Total Selling Space (EOP), th. sq.m

7,371

7,143

228

3.2%

7,371

7,143

228

3.2%

Convenience Stores

5,005

4,900

105

2.1%

5,005

4,900

105

2.1%

Supermarkets

940

941

0

0.0%

940

941

0

0.0%

Drogerie Stores

1,384

1,280

104

8.1%

1,384

1,280

104

8.1%

Other Formats

42

22

19

85.7%

42

22

19

85.7%

Selling Space Addition (Net), th. sq.m

80

207

-127

n/a

132

718

-586

n/a

Convenience Stores

49

123

-74

n/a

53

456

-403

n/a

Supermarkets

-3

2

-5

n/a

-8

-1

-7

n/a

Drogerie Stores

34

72

-38

n/a

81

244

-163

n/a

Other Formats

1

11

-10

n/a

6

19

-14

n/a

LFL composition, %

Average Ticket

Traffic

Sales

Total

12.4%

-4.9%

6.9%

Convenience stores

13.6%

-5.0%

7.8%

Supermarkets

10.6%

-11.3%

-1.9%

Drogerie Stores

9.8%

2.5%

12.6%

LFL composition, %

Average Ticket

Traffic

Sales

Total

13.4%

-5.3%

7.3%

Convenience stores

14.4%

-5.5%

8.2%

Supermarkets

14.1%

-11.5%

1.0%

Drogerie Stores

7.3%

2.8%

10.3%

 

July

Change

August

Change

September

Change

Total net retail sales, RUB million

131,185

14.3%

124,207

10.7%

115,559

9.0%

Convenience Stores

100,978

14.7%

94,884

11.3%

88,689

9.6%

Supermarkets

17,356

3.2%

16,510

-2.2%

14,797

-4.9%

Drogerie Stores

11,965

23.5%

11,909

20.9%

11,119

21.1%

Other Formats

886

437.5%

904

269.3%

954

184.8%

Number of tickets, million

412

0.9%

401

-2.5%

386

-2.6%

Convenience stores

346

0.2%

336

-3.2%

324

-3.4%

Supermarkets

30

-9.2%

29

-11.5%

27

-11.5%

Drogerie Stores

33

13.0%

34

9.4%

32

10.0%

Other Formats

2.7

324.3%

2.8

212.0%

2.9

138.7%

Average ticket[7], RUB

318

13.4%

309

13.5%

299

12.0%

Convenience stores

292

14.5%

282

15.0%

274

13.5%

Supermarkets

583

13.7%

568

10.5%

547

7.5%

Drogerie Stores

358

9.3%

355

10.4%

345

10.1%

Other Formats

327

28.6%

318

24.9%

328

23.6%

Number of Stores (EOP)

20,900

n/a

20,971

n/a

21,154

n/a

Convenience stores

14,579

n/a

14,620

n/a

14,699

n/a

Supermarkets

469

n/a

470

n/a

469

n/a

Drogerie Stores

5,852

n/a 

5,881

n/a 

5,986

n/a 

Store Openings (Gross)

44

n/a

94

n/a

211

n/a

Convenience stores

25

n/a

58

n/a

104

n/a

Supermarkets

0

n/a

1

n/a

0

n/a

Drogerie Stores

19

n/a 

35

n/a 

107

n/a 

Store Closures

38

n/a

23

n/a

28

n/a

Convenience stores

27

n/a

17

n/a

25

n/a

Supermarkets

3

n/a

0

n/a

1

n/a

Drogerie Stores

8

n/a 

6

n/a 

2

n/a 

Store Openings (Net)

6

n/a

71

n/a

183

n/a

Convenience stores

-2

n/a

41

n/a

79

n/a

Supermarkets

-3

n/a

1

n/a

-1

n/a

Drogerie Stores

11

n/a 

29

n/a 

105

n/a 

Total Selling Space (EOP), th. sq. m.

7,290

4.0%

7,316

3.4%

7,371

3.2%

Convenience stores

4,956

2.8%

4,973

2.4%

5,005

2.1%

Supermarkets

941

0.4%

942

0.0%

940

0.0%

Drogerie Stores

1,352

9.4%

1,359

7.9%

1,384

8.1%

Other Formats

41

203.6%

41

130.6%

42

85.7%

Selling Space Added (Net), th. sq. m.

-0.4

n/a

26.0

n/a

54.7

n/a

Convenience stores

0.2

n/a

17.2

n/a

31.4

n/a

Supermarkets

-3.0

n/a

1.4

n/a

-1.7

n/a

Drogerie Stores

2.3

n/a 

7.0

n/a 

24.7

n/a 

Other Formats

0.2

n/a

0.3

n/a

0.3

n/a

million RUB

3Q 2020

3Q 2019

Change

9M 2020

9M 2019

Change

Total revenue

383,189

342,583

11.9%

1,146,550

1,000,499

14.6%

Retail

370,952

332,965

11.4%

1,114,910

975,976

14.2%

Wholesale

12,237

9,618

27.2%

31,640

24,523

29.0%

Gross Profit

91,180

76,930

18.5%

270,701

232,253

16.6%

Gross Margin, %

23.8%

22.5%

134 bps

23.6%

23.2%

40 bps

SG&A, % of sales

-20.5%

-21.0%

54 bps

-20.5%

-21.5%

98 bps

EBITDA pre LTI[8]

27,891

20,672

34.9%

81,461

64,690

25.9%

EBITDA Margin pre LTI, %

7.3%

6.0%

124 bps

7.1%

6.5%

64 bps

EBITDA

27,598

20,101

37.3%

80,819

63,144

28.0%

EBITDA Margin, %

7.2%

5.9%

133 bps

7.0%

6.3%

74 bps

EBIT

16,841

8,945

88.3%

46,978

28,718

63.6%

EBIT Margin, %

4.4%

2.6%

178 bps

4.1%

2.9%

123 bps

Net finance costs

-3,368

-3,802

-11.4%

-10,642

-11,244

-5.4%

FX gain / (loss)

-905

-55

n/a

-1,730

586

-395.3%

Profit before tax

12,567

5,088

147.0%

34,606

18,060

91.6%

Taxes

-2,948

-1,578

86.7%

-7,942

-4,966

59.9%

Net Income

9,620

3,509

174.1%

26,664

13,093

103.6%

Net Income Margin, %

2.5%

1.0%

149 bps

2.3%

1.3%

102 bps

million RUB

3Q 2020

3Q 2019

Change

9M 2020

9M 2019

Change

Total revenue

383,189

342,583

11.9%

1,146,550

1,000,499

14.6%

Retail

370,952

332,965

11.4%

1,114,910

975,976

14.2%

Wholesale

12,237

9,618

27.2%

31,640

24,523

29.0%

Gross Profit

91,180

76,930

18.5%

270,701

232,253

16.6%

Gross Margin, %

23.8%

22.5%

134 bps

23.6%

23.2%

40 bps

SG&A, % of sales

-18.9%

-19.6%

63 bps

-19.0%

-20.1%

111 bps

EBITDA pre LTI[9]

44,680

36,743

21.6%

131,921

111,813

18.0%

EBITDA Margin pre LTI, %

11.7%

10.7%

93 bps

11.5%

11.2%

33 bps

EBITDA

44,388

36,172

22.7%

131,278

110,267

19.1%

EBITDA Margin, %

11.6%

10.6%

103 bps

11.4%

11.0%

43 bps

EBIT

23,080

14,345

60.9%

64,882

42,962

51.0%

EBIT Margin, %

6.0%

4.2%

184 bps

5.7%

4.3%

136 bps

Net finance costs

-10,765

-11,994

-10.2%

-33,700

-35,545

-5.2%

FX gain / (loss)

-1,018

-41

n/a

-1,938

600

-423.1%

Profit before tax

11,297

2,310

389.0%

29,244

8,017

264.8%

Taxes

-2,693

-1,023

163.3%

-6,870

-2,958

132.3%

Net Income

8,603

1,287

568.4%

22,374

5,059

342.2%

Net Income Margin, %

2.2%

0.4%

187 bps

2.0%

0.5%

145 bps

Million RUB

30.09.2020

30.06.2020

Inventories

209,526

219,236

Trade and other receivables

13,038

9,949

Cash and cash equivalents

5,551

21,149

 

 

 

Long-term borrowings

150,733

117,389

Trade and other payables

121,280

117,654

Short-term borrowings and short-term portion of long-term borrowings

33,092

91,204

 

30 September 2020

30 June 2020

31 December 2019

30 September 2019

Gross Debt, RUB billion

183.8

208.6

184.2

175.3

Net Debt, RUB billion

178.3

187.4

175.3

168.7

Net Debt/EBITDA

1.8x

2.0x

2.1x

2.0x

ISIN:

US55953Q2021

Category Code:

MSCU

TIDM:

MGNT

LEI Code:

2534009KKPTVL99W2Y12

OAM Categories:

2.2. Inside information

Sequence No.:

86774

EQS News ID:

1143847


 

End of Announcement

EQS News Service

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