Magnit

Earnings Release • Jul 9, 2014

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OJSC MAGNIT - June/6M 2014 Results

PR Newswire

London, July 9

Press-releaseKrasnodarJuly 9, 2014OJSC "Magnit" Announces 32.75% Retail Sales Growth in Rubles forJune 2014[1]Krasnodar, July 9, 2014: OJSC "Magnit", Russia's largest foodretailer (the "Company"; MICEX and LSE: MGNT) announces 32.75% retail salesgrowth in rubles for June 2014.During June 2014 the Company opened (net) 101 stores. The totalstore base reached 8,618 stores (7,614 convenience stores, 169 hypermarkets,57 "Magnit Family" stores and 778 cosmetics stores).Preliminary consolidated unaudited net retail revenue (excl. VAT)in 6M 2014 increased by 27.90% in ruble terms (compared to 6M 2013) and stoodat 348,903.73 million rubles.According to Rosstat food inflation in June 2014 amounted to 0.7%compared to 0.5% in June 2013, in 6M2014 - 7.6% compared to 5.2% in 6M2013.June 2014 Key Operating and Financial Highlights: June 2014 June 2013 Growth RateNumber of opened stores, NET 101 170 n/a convenience stores 69 169 n/a hypermarkets 0 3 n/a magnit family 6 2 n/a cosmetics stores 26 (4) n/aTotal number of stores 8,618 7,416 n/a convenience stores 7,614 6,552 n/a hypermarkets 169 138 n/a magnit family 57 26 n/a cosmetics stores 778 700 n/aSelling space growth, th. sq.m. 35.94 57.43 n/a convenience stores 22.68 49.22 n/a hypermarkets 0.00 6.43 n/a magnit family 7.81 1.79 n/a cosmetics stores 5.45 0.003 n/aSelling space, eop, th. sq. m. 3,189.21 2,748.09 16.05% convenience stores 2,433.66 2,129.38 14.29% hypermarkets 504.54 423.09 19.25% magnit family 67.03 31.19 114.94% cosmetics stores 183.99 164.44 11.89%Number of customers, million 247.02 207.54 19.02% convenience stores 215.99 185.11 16.68% hypermarkets 20.11 16.19 24.25% magnit family 4.77 2.30 107.58% cosmetics stores 6.15 3.94 55.81%Net retail sales, million RUR 63,031.96 47,482.97 32.75% convenience stores 47,957.24 37,034.13 29.49% hypermarkets 11,632.12 8,731.89 33.21% magnit family 1,948.73 808.89 140.91% cosmetics stores 1,493.87 908.06 64.51%Net retail sales, million US$[2] 1,831.85 1,470.96 24.53% convenience stores 1,393.75 1,147.27 21.48% hypermarkets 338.06 270.50 24.97% magnit family 56.63 25.06 126.01% cosmetics stores 43.42 28.13 54.34%2Q and 6M 2014 Key Operating and Financial Highlights: 2Q 2014 2Q 2013 Growth Rate 6М 2014 6М 2013 Growth RateNumber of opened stores, NET 362 341 n/a 525 532 n/a convenience stores 273 343 n/a 414 506 n/a hypermarkets 4 6 n/a 8 12 n/a magnit family 7 5 n/a 11 6 n/a cosmetics stores 78 (13) n/a 92 8 n/aTotal number of stores 8,618 7,416 n/a 8,618 7,416 n/a convenience stores 7,614 6,552 n/a 7,614 6,552 n/a hypermarkets 169 138 n/a 169 138 n/a magnit family 57 26 n/a 57 26 n/a cosmetics stores 778 700 n/a 778 700 n/aSelling space growth, th. sq.m. 120.60 118.21 n/a 177.83 198.84 n/a convenience stores 83.95 99.18 n/a 121.46 151.92 n/a hypermarkets 11.01 15.62 n/a 21.66 35.47 n/a magnit family 8.95 5.38 n/a 13.77 6.83 n/a cosmetics stores 16.70 (1.97) n/a 20.95 4.61 n/aSelling space, eop, th. sq. m. 3,189.21 2,748.09 16.05% 3,189.21 2,748.09 16.05% convenience stores 2,433.66 2,129.38 14.29% 2,433.66 2,129.38 14.29% hypermarkets 504.54 423.09 19.25% 504.54 423.09 19.25% magnit family 67.03 31.19 114.94% 67.03 31.19 114.94% cosmetics stores 183.99 164.44 11.89% 183.99 164.44 11.89%Number of customers, million 737.81 619.62 19.08% 1,400.48 1,182.63 18.42% convenience stores 647.16 554.28 16.76% 1,229.92 1,059.74 16.06% hypermarkets 59.88 47.80 25.27% 112.96 89.93 25.60% magnit family 13.87 6.50 113.29% 25.41 12.09 110.22% cosmetics stores 16.90 11.03 53.26% 32.19 20.88 54.19%Net retail sales, million RUR 184,951.91 141,582.69 30.63% 348,903.73 272,800.56 27.90% convenience stores 140,961.74 111,116.10 26.86% 266,982.05 215,261.33 24.03% hypermarkets 34,418.47 25,687.12 33.99% 64,008.30 48,358.02 32.36% magnit family 5,628.15 2,267.66 148.19% 10,081.71 4,203.45 139.84% cosmetics stores 3,943.55 2,511.80 57.00% 7,831.68 4,977.77 57.33%Net retail sales, million US$[3] 5,284.36 4,478.62 17.99% 9,974.49 8,795.22 13.41% convenience stores 4,027.49 3,514.89 14.58% 7,632.51 6,940.13 9.98% hypermarkets 983.39 812.55 21.02% 1,829.88 1,559.09 17.37% magnit family 160.80 71.73 124.17% 288.22 135.52 112.67% cosmetics stores 112.67 79.45 41.81% 223.89 160.49 39.51%LFL resultsFormats 2Q 2014 - 2Q 2013[4] # of Stores Average Ticket Traffic SalesConvenience Stores 5,990 9.00% 2.93% 12.20%Hypermarkets 135 8.13% 6.37% 15.02%Magnit Family 23 9.47% 9.99% 20.40%Cosmetics Stores 590 3.61% 40.58% 45.65%Total 6,738 9.16% 3.91% 13.43%Formats 6M 2014 - 6M 20134[4] # of Stores Average Ticket Traffic SalesConvenience Stores 5,881 7.23% 1.90% 9.26%Hypermarkets 135 6.37% 5.55% 12.28%Magnit Family 23 7.51% 9.96% 18.22%Cosmetics Stores 556 3.05% 45.11% 49.54%Total 6,595 7.46% 2.95% 10.63%For further information, please contact:Timothy Post Director, Investor Relations Email: post@magnit.ru Office: +7-861-277-4554 x 17600 Mobile: +7-961-511-7678 Direct Line: +7-861-277-4562Dina Svishcheva Deputy Director, Investor Relations Email: Chistyak@magnit.ru Office: +7-861-277-45-54 x 15101 Mobile: +7-961-511-0202 Direct Line: +7-861-277-4562Company description:Magnit is Russia's largest food retailer. Founded in 1994, thecompany is headquartered in the southern Russian city of Krasnodar. As of June30, 2014, Magnit operated 24 distribution centers and over 8,600 stores (7,614convenience, 226 hypermarkets, and 778 cosmetics) in approximately 2,000cities and towns throughout 7 federal regions of the Russian Federation.In accordance with the audited IFRS consolidated financialstatements for 2013, Magnit had revenues of $18,202 million USD and an EBITDAof $2,032 million USD. Magnit's local shares are traded on the Moscow StockExchange (MICEX: MGNT) and its GDRs on the London Stock Exchange (LSE: MGNT)and it has a credit rating from Standard & Poor's of BB. Measured by marketcapitalization, Magnit is one of the largest retailers in Europe.---------------------------------[1] According to management accounts[2] Based on the average exchange rate for June 2014 - 34.4089 RUBper 1 USD, June 2013 - 32.2803 RUB per 1 USD[3] Based on the average exchange rate for 2Q 2014 - 34.9999 RUBper 1 USD, 2Q 2013 - 31.6130 RUB per 1 USD, 6M 2014 - 34.9796 RUB per 1 USD,6M 2013 - 31.0169 RUB per 1 USD[4] LFL calculation base includes stores (all formats), which havebeen opened 12 months prior to the last month of the reporting period. i.e. byJune 1, 2013.