DIXY GROUP DEMONSTRATES STRONG GROWTH AND SOLID PROFITABILITY IMPROVEMENT IN THE THIRD QUARTER OF 2014 Moscow, Russia, November 24, 2014 DIXY Group (MOEX: DIXY) – one of Russia’s leading retailers of foods and everyday products – today announced unaudited IFRS results for the third quarter and first nine months of 2014. Key highlights of the third quarter and the first nine months of 2014: In the first nine months of 2014, the Company opened 269 stores on net basis. As of September 30, 2014, the Company operated 2,068 stores in Central, North-West and Urals Federal Districts of Russia. Selling Space increased by 23% year-on-year to 703,507 sq. m as of September 30, 2014. Revenue increased by 31.0% (18.8% in USD) year-on-year to RUB 57.9 bln (USD 1.6 bln) in the third quarter and grew by 25.3% (12.0% in USD) year-on-year to RUB 164.9 bln (USD 4.7 bln) in the first nine months of 2014. Gross Profit grew by 29.2% (17.1% in USD) year-on-year to RUB 17.4 bln (USD 482.0 mln) in the third quarter of 2014, and grew by 25.9% (12.5% in USD) year-on-year to RUB 49.9 bln (USD 1.4 bln) in the first nine months of 2014. EBITDA grew by 56.3% (41.6% in USD) year-on-year to RUB 4.3 bln (USD 119.8 mln) in the third quarter of 2014, and grew by 45.0% (29.6% in USD) year-on-year to RUB 11.7 bln (USD 331.5 mln) in the first nine months of 2014. EBITDA Margin improved by 120 basis points year-on-year to 7.5% in the third quarter, and by 100 basis points year-on-year to 7.1% in the first nine months of 2014. Net Profit almost doubled year-on-year to RUB 1.2 bln (USD 33.0 mln) in the third quarter of 2014, and grew 2.4x times to RUB 3.2 bln (USD 89.3 mln) in the first nine months of 2014. Operating Cash Flow increased by 60.1% (43.0% in USD) year-on-year to RUB 5.8 bln (USD 164.2 mln) in the first nine months of 2014. 1 In the first nine months of 2014, the Company opened 269 stores on net basis and increased selling space by 23% year-on-year. In the third quarter of 2014, the Company continued ticket and traffic driving promotional activity in DIXY chain. The Company extended the range of its private label products, and continued to advertise, promote, and invest in “D”brand. In the third quarter of 2014, the Company demonstrated 14.6% like-for-like sales growth on Group level, and record 17.7% like-for-like sales growth for DIXY banner. The Company improved centralization level (deliveries through own distribution centers) for its neighborhood stores to 89% in the third quarter of 2014. The logistic service level (success of deliveries ratio) stood at 91% in the third quarter of 2014. 3Q and 9M 2014 Key Financial Highlights, year-on-year in RUB million Total Revenue Retail Revenue Gross Profit Gross Margin, % SG&A SG&A, % of Sales Operating Profit Operating Margin, % Net Profit Net Profit Margin, % EBITDA EBITDA Margin, % 3Q 2014 57,895 57,422 17,442 30.1% 14,825 25.6% 2,617 4.5% 1,195 2.1% 4,335 7.5% 3Q 2013 44,180 43,778 13,504 30.6% 12,002 27.2% 1,502 3.4% 628 1.4% 2,774 6.3% Change 31.0% 31.2% 29.2% (50 bp) 23.5% (160 bp) 74.3% 110 bp 90.4% 70 bp 56.3% 120 bp 9M 2014 9M 2013 164,858 163,494 49,919 30.3% 42,972 26.1% 6,947 4.2% 3,160 1.9% 11,732 7.1% 131,567 130,374 39,643 30.1% 35,209 26.8% 4,433 3.4% 1,331 1.0% 8,089 6.1% Change 25.3% 25.4% 25.9% 20 bp 22.1% (70 bp) 56.7% 80 bp 2,4х 90 bp 45.0% 100 bp Revenues Revenue increased by 31.0% (18.8% in USD) year-on-year to RUB 57.9 bln (USD 1.6 bln), driven by organic expansion and supported by 14.6% like-for-like sales growth in the third quarter of 2014. DIXY neighborhood stores revenue increased by 37.2% (24.3% in USD) year-on-year to RUB 46.2 bln (USD 1.3 bln) in the third quarter of 2014. Victoria division revenue grew by 14.9% (4.2% in USD) year-on-year to RUB 7.2 bln (USD 199.1 mln), while MegaMart division revenue increased by 5.1% (decreased by 4.7% in USD) to RUB 4.1 bln (USD 112.0 mln) in the third quarter of 2014. Gross Profit Gross Profit grew by 29.2% (17.1% in USD) year-on-year to RUB 17.4 bln (USD 482.0 mln) in the third quarter of 2014. Gross Margin decreased by 50 basis points year-on-year to 30.1% in the third quarter of 2014, driven mainly by increased shrinkage costs, and offset partially by better commercial terms from suppliers. Cost of goods sold, as a percentage of sales, decreased by 20 basis points year-on-year to 66.5% of sales in the third quarter of 2014, driven by better purchasing terms. Shrinkage costs, as a percentage of sales, increased by 70 basis points year-on-year to 2.6% of sales in the third quarter of 2014, due mainly to growing share of fresh categories, especially, fruits and vegetables, in DIXY stores revenue. Transportation costs, as a percentage of sales, remained flat year-on-year at 0.8% as percentage of sales in the third quarter of 2014. 2 Operating Expenses Selling, General & Administrative Expenses increased by 23.5% (12.0% in USD) year-on-year to RUB 14.8 bln (USD 409.6 mln) in the third quarter of 2014. SG&A expenses, as a percentage of sales, decreased by 160 basis points year-on-year to 25.6%. The decrease was driven mainly by the reduction of staff expenses and utilities, repair and maintenance expenses, as a percentage of sales, offset partially by increased operating lease, and depreciation and amortization expenses, as a percentage of sales, in the third quarter of 2014. Staff expenses increased by 20.8% (9.5% in USD) year-on-year to RUB 6.9 bln (USD 191.6 mln) in the third quarter of 2014, due primarily to organic growth of the business and wage indexations. Staff expenses, as a percentage of sales, decreased by 100 basis points to 12.0% in the third quarter of 2014, driven mainly by higher staff productivity and strong like-for-like stores performance. Operating lease expenses grew by 32.8% (20.4% in USD) year-on-year to RUB 3.5 bln (USD 96.4 mln). Operating lease expenses, as a percentage of sales, increased by 10 basis points year-on-year to 6.0% in the third quarter of 2014, mainly, because of growing share of rented space and larger number of newly opened stores in the first nine months of 2014 compared to the same period last year. Utilities, repair and maintenance expenses increased by 11.5% (1.1% in USD) year-on-year to RUB 1.2 bln (USD 33.9 mln) in the third quarter of 2014, due mainly to utilities tariffs indexation. Utilities, repair and maintenance expenses, as a percentage of sales, decreased by 40 basis points year-on-year to 2.1% in the third quarter of 2014, due mainly to strong like-for-like stores performance. EBITDA grew by 56.3% (41.6% in USD) year-on-year to RUB 4.3 bln (USD 119.8 mln) in the third quarter of 2014, and grew by 45.0% (29.6% in USD) year-on-year to RUB 11.7 bln (USD 331.5 mln) in the first nine months of 2014. EBITDA Margin increased by 120 basis points year-on-year to 7.5% in the third quarter of 2014, and by 100 basis points year-on-year to 7.1% in the first nine months of 2014. Operating and Net Profits Depreciation and amortization expenses increased by 35.0% (22.4% in USD) year-on-year to RUB 1.7 bln (USD 47.5 mln) in the third quarter of 2014, driven mainly by organic growth of the store chain, as well as logistic infrastructure development. D&A expenses, as a percentage of sales, increased by 10 basis points to 3.0% in the third quarter of 2014. Operating Profit grew by 74.3% (57.9% in USD) year-on-year to RUB 2.6 bln (USD 72.3 mln) in the third quarter of 2014. Operating Margin improved by 110 basis points year-on-year to 4.5% in the third quarter of 2014. Income tax expense amounted to RUB 377.9 mln (USD 10.4 mln), while effective tax rate stood at 24.0% in the third quarter of 2014. Net Profit increased by 90.4% year-on-year to RUB 1.2 bln (USD 33.0 mln) in the third quarter of 2014, and grew 2.4x times year-on-year to RUB 3.2 bln (USD 89.3 mln) in the first nine months of 2014. Net Profit Margin improved by 70 basis points year-on-year to 2.1% in the third quarter of 2014, and by 90 basis points year-on-year to 1.9% in the first nine months of 2014. Cash Flows and Debt Net Cash from Operating Activities increased by 60.1% (43.0% in USD) to RUB 5.8 bln (USD 164.2 mln) in the first nine months of 2014 from RUB 3.6 bln (USD 114.8 mln) in the first nine months of 2013. The increase was attributable to the Company’s revenue and profitability growth. As of September 30, 2014, Total Financial Debt to EBITDA ratio declined to 1.7, and Total Financial Debt amounted to RUB 26.7 bln (USD 678.8 mln), while Net Debt amounted to RUB 23.8 bln (USD 605.0 mln) as of September 30, 2014. 3 3Q and 9M 2014 Income Statement Highlights, year-on-year in RUB million 3Q 2014 3Q 2013 Change Total Revenue Retail Revenue DIXY division Victoria division Victoria supermarkets Victoria neighborhood CASH Megamart division Megamart Minimart Total COGS Cost of Goods Sold as % of Sales Transportation Costs as % of Sales Shrinkage of Inventories as % of Sales Gross Profit Gross Margin, % Total SG&A as % of Sales Staff Expenses as % of Sales Operating Lease Expenses as % of Sales D&A Expenses as % of Sales Utilities, Repair and Maintenance Expenses as % of Sales Advertising Expenses as % of Sales Other Expenses as % of Sales Operating Profit Operating Margin, % Finance Costs (Net) Net FX Loss (Gain) Profit before Tax Income Tax Expense Net Profit Net Profit Margin, % 9M 2014 9M 2013 Change 57,895 57,422 46,163 7,205 5,767 1,191 247 4,054 3,213 841 40,452 38,496 66.5% 447 0.8% 1,509 2.6% 17,442 30.1% 14,825 25.6% 6,936 12.0% 3,489 6.0% 1,718 3.0% 1,227 44,180 43,778 33,652 6,269 4,947 1,122 200 3,856 3,048 808 30,677 29,475 66.7% 354 0.8% 847 1.9% 13,504 30.6% 12,002 27.2% 5,742 13.0% 2,627 5.9% 1,272 2.9% 1,101 31.0% 31.2% 37.2% 14.9% 16.6% 6.1% 23.6% 5.1% 5.4% 4.1% 31.9% 30.6% (20 bp) 26.2% 78.2% 70 bp 29.2% (50 bp) 23.5% (160 bp) 20.8% (100 bp) 32.8% 10 bp 35.0% 10 bp 11.5% 164,858 163,494 129,763 21,557 17,310 3,551 696 12,175 9,693 2,482 114,939 109,721 66.6% 1,229 0.7% 3,989 2.4% 49,919 30.3% 42,972 26.1% 20,745 12.6% 9,691 5.9% 4,785 2.9% 3,868 131,567 130,374 100,106 18,777 14,648 3,519 610 11,491 9,017 2,473 91,924 88,341 67.1% 1,140 0.9% 2,444 1.9% 39,643 30.1% 35,209 26.8% 17,631 13.4% 7,392 5.6% 3,656 2.8% 3,097 25.3% 25.4% 29.6% 14.8% 18.2% 0.9% 14.1% 6.0% 7.5% 0.3% 25.0% 24.2% (50 bp) 7.8% (20 bp) 63.2% 50 bp 25.9% 20 bp 22.1% (70 bp) 17.7% (80 bp) 31.1% 30 bp 30.9% 10 bp 24.9% 2.1% 273 0.5% 1,182 2.0% 2,617 4.5% 931 113 1,573 378 1,195 2.1% 2.5% 204 0.5% 1,056 2.4% 1,502 3.4% 872 (27) 657 29 628 1.4% (40 bp) 33.7% 12.0% (40 bp) 74.3% 110 bp 6.8% N/A 2.4x 13.1x 90,4% 70 bp 2.3% 688 0.4% 3,195 1.9% 6,947 4.2% 2,648 152 4,146 986 3 160 1.9% 2.4% 589 0.4% 2,844 2.2% 4,433 3.4% 2,529 47 1,858 526 1 331 1.0% (10 bp) 16.7% 12.3% (30 bp) 56.7% 80 bp 4.7% 3.2x 2.2x 87.4% 2.4x 90 bp Operating profit to EBITDA Reconciliation for 3Q and 9M 2014, year-on-year in RUB million 3Q 2014 3Q 2013 Change 9M 2014 9M 2013 Change Operating profit Depreciation & Amortization EBITDA 2,617 1,718 4,335 1,502 1,272 2,774 74.3% 35.0% 56.3% 6,947 4,785 11,732 4,433 3,656 8,089 56.7% 30.9% 45.0% 4 9M 2014 Cash Flow Statement Highlights, year-on-year in RUB million Net Cash Generated from Operating Activities Net Cash from Operating Activities before Changes in WC Change in WC Net Interest and Income Tax Paid Net Cash Used in Investing Activities Net Cash Used in Financing Activities Net Increase/(Decrease) in Cash & Cash Equivalents Cash and Cash Equivalents, EOP Total Financial Debt as of September 30, 2014 in RUB million Total Financial Debt Short-term Debt Long-term Debt Net Debt 9M 2014 5,812 11,901 (1,775) (4,315) (5,266) (2,037) (1,492) 2,905 ∆ 60.1% 43.9% N/A N/A N/A N/A N/A 54.0% 9M 2013 3,631 8,270 (1,380) (3,259) (4,881) (509) (1,759) 1,887 As of 30.09.2014 26,735 4,755 21,980 23,830 % of total 100% 18% 82% - 9M 2014 Stores Operational Statistics, year-on-year As of 30.09.2014 2,068 269 1,478,895 24% 703,507 20% Number of Stores New Store Openings (net) Total Space, sq. m Total Space Owned, % Selling Space, sq. m Selling Space Owned, % 3Q and 9M 2014 Average Ticket by Format, year-on-year Rubles, incl. VAT 3Q 2014 3Q 2013 DIXY neighborhood stores Kvartal neighborhood stores Victoria Supermarket Cash&Carry CASH Compact hypermarket MegaMart Compact hypermarket MiniMart 295.6 255.6 476.9 2,121.2 634.9 455.0 264.9 243.1 485.5 2 099.8 593.9 428.2 ∆% 12% 5% (2%) 1% 7% 6% As of 30.09.2013 1,667 168 1,250,574 26% 574,180 23% ∆ 401 101 18% (200 bp) 23% (300 bp) 9M 2014 9M 2013 300.1 260.7 501.7 2,155.8 642.2 456.4 267.4 247.7 498.4 2,127.5 604.2 439.6 ∆% 12% 5% 1% 1% 6% 4% Significant Disclosure Annotations: Financial statements for the third quarter and first nine months of 2014 disclosed in the press release are unaudited. Total financial debt includes borrowings and financial lease liabilities. Net debt is calculated as Total financial debt minus Cash and cash equivalents as of the end of the period. Based on the audited appraisal of DIXY Group financial statements for FY2013, Group’s financials reported for the second quarter of 2013 were restated. As a result, Group’s financials reported for the first nine months of 2013 were also restated after reporting date. The following official exchange rates of the Central Bank of Russian Federation were used to convert Russian Rubles to US dollars: Average (third quarter), RUB/USD Average (nine months), RUB/USD As of September, 30, RUB/USD 2013 32.7977 31.6170 - 2014 36.1909 35.3878 39.3866 5 OJSC DIXY Group (MOEX: DIXY) is one of Russia’s leading retailers of foods and everyday products. The first DIXY store was opened in Moscow in 1999, and after that the Company had been experiencing the period of the intensive organic development, followed by the major acquisition of Victoria Group in June 2011. As of October 31, 2014, the Company operated 2,093 stores, including 1,966 DIXY neighborhood stores, 92 Victoria stores, 1 CASH store, and 34 compact hypermarkets MegaMart and MiniMart. The Company operates in Central, Northwest and Urals federal districts of Russia, and in Kaliningrad region. As of October 31, 2014, the Company had a total of 714,026 square meters of selling space. The Company is the third largest national food retailer by revenue, selling area, and number of stores. The Company employs over 40,000 people. In May 2007, the Company raised USD 360 mln in its IPO on the RTS and MICEX. A controlling stake of 54.4% in OJSC DIXY Group is owned by Mercury Group, a diversified holding company. In 2013, the Company’s total revenue amounted to RUB 180 bln (USD 5.7 bln). The Russian business magazine Expert rates DIXY Group as one of the Top-100 largest Russian companies. For further enquiries, please, contact: Natalya Belyavskaya Head of Investor Relations DIXY Group of Companies Tel.: + 7 495 223-3338 Fax: + 7 495 933-0259 E-mail: [email protected] [email protected] http://www.dixy.ru/ Anastasia Orlova PR Director DIXY Group of Companies Tel.: +7 495 933 1450 ext. 2132 Fax: +7 495 933 0259 Mob.: +7 916 953 20 56 E-mail: [email protected] [email protected] http://www.dixy.ru/ 6 OJSC DIXY Group Interim consolidated statement of financial position At 30 September 2014 (in thousands of Russian roubles, unless otherwise indicated) Assets Non-current assets Property, plant and equipment Capital advances Goodwill Other intangible assets Operating lease deposits Initial lease costs Loans Deferred tax asset Available-for-sale investments Current assets Inventories Trade and other receivables Taxes recoverable and prepayments Income tax prepayments Loans Initial lease costs Cash and cash equivalents Total assets Equity and liabilities Equity attributable to equity holders of the Parent Share capital Additional paid-in capital Treasury shares Retained earnings Non-controlling interest Total equity Non-current liabilities Borrowings Finance leases Unfavourable operating lease agreements Deferred tax liability Current liabilities Trade and other payables Borrowings Finance leases Advances from customers Tax liability, other than income taxes Income taxes payable Unfavourable operating lease agreements Provisions for liabilities and charges Total equity and liabilities 30 September 2014 (unaudited) 31 December 2013 (audited) 35,174,836 489,772 17,665,526 2,782,170 1,152,855 79,808 211,052 386,794 37,530 57,980,343 34,061,088 987,283 17,665,526 2,877,612 941,906 108,565 139,314 428,532 – 57,209,826 11,231,057 7,234,455 1,379,285 638,901 5,579 22,385 2,905,108 23,416,770 81,397,113 10,102,566 6,039,855 1,814,778 452,284 3,156 27,242 4,397,044 22,836,925 80,046,751 1,248 20,443,341 (554) 10,243,909 30,687,944 353 30,688,297 1,248 20,443,341 (554) 7,083,876 27,527,911 357 27,528,268 21,980,473 50,173 642,172 22,672,818 28,560,115 2,535 76,451 851,691 29,490,792 21,891,648 4,741,122 13,598 228,471 1,077,144 41,461 36,791 5,763 28,035,998 50,708,816 81,397,113 21,468,165 327,808 47,012 307,023 793,827 34,808 43,285 5,763 23,027,691 52,518,483 80,046,751 7 OJSC DIXY Group Interim consolidated statement of comprehensive income For the nine months ended 30 September 2014 (in thousands of Russian roubles, unless otherwise indicated) For the nine months Revenue Cost of sales Gross profit Selling, general and administrative expenses Operating profit Finance income Finance costs Foreign exchange loss, net Profit before income tax Income tax expense ended 30 September 2014 2013 (unaudited) 164,857,687 131,566,729 (114,938,865) (91,924,034) 49,918,822 39,642,695 (42,972,275) (35,209,332) 6,946,547 4,433,363 127,687 10,964 (2,775,732) (2,539,758) (152,432) (46,890) 4,146,070 1,857,679 (986,037) (526,290) Profit for the period 3,160,033 1,331,389 Total comprehensive income for the year 3,160,033 1,331,389 3,160,037 (4) 3,160,033 1,331,260 129 1,331,389 Attributable to: Equity holders of the Parent Non-controlling interest 8 OJSC DIXY Group Interim consolidated statement of cash flows For the nine months ended 30 September 2014 (in thousands of Russian roubles, unless otherwise indicated) For the nine months ended 30 September 2014 2013 (unaudited) Cash flows from operating activities Profit before income tax Adjustments for: Depreciation of property, plant and equipment Amortisation of intangible assets Amortisation of initial lease costs Amortisation of unfavourable lease commitments Loss on disposals of property, plant and equipment and intangible assets Increase/(decrease) in provision for impairment of taxes recoverable and prepayments Increase in provision for impairment of trade and other receivables Write down/(reversal of write down) of inventory to net realizable value Finance costs Finance income Unrealised foreign exchange losses Operating cash flows before working capital changes Increase in trade and other receivables (Increase)/decrease in inventories Increase in operating lease deposits Decrease in taxes recoverable and prepayments Increase/(decrease) in trade and other payables Increase in tax liability, other than income tax Decrease in advances from customers Cash generated from operations Income tax paid Interest paid Net cash from operating activities Cash flows from investing activities Purchase of property, plant and equipment Proceeds from sale of property, plant and equipment Proceeds from sale of intangible assets Initial lease costs paid Disbursement of loans Loans repaid Interest received Purchases of intangible assets Purchase of available-for-sale investments Net cash used in investing activities Cash flows from financing activities Proceeds from loans and borrowings Repayment of loans and borrowings Purchase of non-contolling interest in subsidiary Finance lease payments Net cash used in financing activities Net decrease in cash and cash equivalents Cash and cash equivalents at the beginning of the period Cash and cash equivalents at the end of the period 4,146,070 1,857,679 4,551,505 238,032 28,713 (32,772) 15,050 42,257 51,760 59,928 2,775,732 (127,687) 152,432 11,901,020 (1,222,110) (1,188,418) (210,950) 477,103 164,903 283,317 (78,552) 10,126,313 (1,333,783) (2,981,025) 5,811,505 3,469,308 200,971 26,293 (40,841) 216,092 (1,327) 1,350 (35,081) 2,539,758 (10,964) 46,890 8,270,128 (2,126,028) 1,054,533 (286,999) 1,703,989 (1,870,661) 244,789 (99,386) 6,890,365 (961,611) (2,297,864) 3,630,890 (5,284,624) 92,809 7,716 (2,000) 120,413 (163,100) (37,530) (5,266,316) (5,060,486) 338,979 (29,334) 857 4,244 (135,025) (4,880,765) (2,001,176) (35,949) (2,037,125) (1,491,936) 4,397,044 2,905,108 7,895,506 (8,377,180) (505) (27,093) (509,272) (1,759,147) 3,646,067 1,886,920 9
© Copyright 2024