Magnit

Earnings Release • Oct 20, 2017

MAGNIT PJSC (MGNT)

20-Oct-2017 / 09:00 CET/CEST

Dissemination of a RegulatoryAnnouncement 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.

Press Release Krasnodar October 20, 2017

PJSC"Magnit" Announces Unaudited 9M 2017 Results

Krasnodar, Russia (October 20, 2017): Magnit PJSC, one of Russia's leading retailers (MOEX and LSE: MGNT) announces its unaudited 9M 2017 results prepared in accordance with IFRS [1] .

During 9M 2017 Magnit added (net) 1,638 stores. The total store base as of September 30, 2017 reached 15,697 stores (11,743 convenience stores, 236 hypermarkets, 196 "Magnit Family"storesand 3,522 drogeriestores). Selling space increased by 15.28% in comparisonwith 9M 2016 from4.83 million sq. m. to 5.56 million sq. m.

Revenueincreased by 6.4%from790 billionRURin 9M2016 to 841 billionRURin 9M2017.

Gross Profit increased from217 billionRURin 9M2016 to 228 billionRURin 9M2017. Gross Margin in 9M2017 was 27.1%.

EBITDAin 9M2017 was 69 billionRUR. EBITDAmargin in the 9Mof 2017 was 8.3%.

Net Incomein 9M2017 was 28 billionRUR. Net Income Margin in 9M2017 was 3.3%.

According to Rosstat, CPI for the last 12M (October 2016 - September 2017) was 3.0% compared to 6.4% for the same period in the previous year.

According to Rosstat, food inflation for the last 12M (October 2016 - September 2017) was 2.0% Y-o-Y vs 5.9% for the same period in the previous year.

9M 2017 presentation, which contains additional financial, operational and other data regarding 1H 2017 results, will be published at http://ir.magnit.com/en/shareholder-center/investor-presentation/

3Q2017 Monthly Operating Highlights:

	July	Y-o-Y, %	August	Y-o-Y, %	September	Y-o-Y, %
NewStore Openings (NET)	227	n/a	277	n/a	349	n/a
Convenience stores	165	n/a	196	n/a	268	n/a
Hypermarkets	(5)	n/a	0	n/a	1	n/a
Magnit Family	3	n/a	2	n/a	1	n/a
Drogerie Stores	64	n/a	79	n/a	79	n/a
Number of Stores (EOP)	15,071	n/a	15,348	n/a	15,697	n/a
Convenience stores	11,279	n/a	11,475	n/a	11,743	n/a
Hypermarkets	235	n/a	235	n/a	236	n/a
Magnit Family	193	n/a	195	n/a	196	n/a
Drogerie Stores	3,364	n/a	3,443	n/a	3,522	n/a
NewSelling Space, th. sq. m.	58.14	n/a	83.21	n/a	101.53	n/a
Convenience stores	50.17	n/a	59.20	n/a	80.40	n/a
Hypermarkets	(9.44)	n/a	2.64	n/a	2.09	n/a
Magnit Family	3.35	n/a	2.52	n/a	1.01	n/a
Drogerie Stores	14.06	n/a	18.85	n/a	18.02	n/a
Total Selling Space (EOP), th. sq. m.	5,377.74	13.88%	5,460.95	13.96%	5,562.48	15.28%
Convenience stores	3,701.72	13.61%	3,760.92	14.07%	3,841.32	15.71%
Hypermarkets	681.63	3.00%	684.26	2.83%	686.35	4.09%
Magnit Family	212.26	10.98%	214.79	11.13%	215.80	9.93%
Drogerie Stores	782.13	28.01%	800.99	25.96%	819.01	26.02%

Number of Customers, million	351.20	4.56%	356.75	5.88%	336.40	7.47%
Convenience stores	296.52	4.50%	301.30	6.07%	284.28	7.79%
Hypermarkets	21.45	(5.70%)	21.24	(5.59%)	19.98	(2.73%)
Magnit Family	11.67	3.01%	11.71	3.81%	10.90	4.71%
Drogerie Stores	21.57	19.32%	22.50	17.65%	21.25	15.78%
[2] Retail Sales , million RUR	97,700.86	5.15%	95,669.65	6.14%	89,307.47	6.02%
Convenience stores	73,336.38	6.56%	71,671.52	7.73%	66,968.76	7.43%
Hypermarkets	12,585.12	(7.11%)	12,071.40	(6.74%)	11,188.27	(5.56%)
Magnit Family	5,183.61	3.85%	5,029.88	4.76%	4,647.47	4.14%
Drogerie Stores	6,595.75	18.73%	6,896.86	17.73%	6,502.97	16.42%
2 [3] Retail Sales , million USD	1,637.33	13.38%	1,603.86	15.54%	1,547.92	18.71%
Convenience stores	1,229.02	14.90%	1,201.54	17.27%	1,160.73	20.28%
Hypermarkets	210.91	0.17%	202.37	1.51%	193.92	5.75%
Magnit Family	86.87	11.98%	84.32	14.04%	80.55	16.60%
Drogerie Stores	110.54	28.03%	115.62	28.15%	112.71	30.36%

3Q and 9M 2017 Operating Highlights:

	3Q2017	3Q2016	Y-o-Y, %	9M2017	9M2016	Y-o-Y, %
NewStore Openings (NET)	853	476	n/a	1,638	1,275	n/a
Convenience stores	629	236	n/a	1,222	544	n/a
Hypermarkets	(4)	0	n/a	(1)	9	n/a
Magnit Family	6	9	n/a	2	24	n/a
Drogerie Stores	222	231	n/a	415	698	n/a
Number of Stores (EOP)	15,697	13,364	n/a	15,697	13,364	n/a
Convenience stores	11,743	10,138	n/a	11,743	10,138	n/a
Hypermarkets	236	228	n/a	236	228	n/a
Magnit Family	196	179	n/a	196	179	n/a
Drogerie Stores	3,522	2,819	n/a	3,522	2,819	n/a
NewSelling Space, th. sq. m.	242.87	148.19	n/a	494.80	411.67	n/a
Convenience stores	189.77	83.67	n/a	388.92	200.24	n/a
Hypermarkets	(4.71)	(1.14)	n/a	2.68	20.23	n/a
Magnit Family	6.88	9.26	n/a	3.04	26.13	n/a
Drogerie Stores	50.93	56.39	n/a	100.17	165.07	n/a
Total Selling Space (EOP), th. sq. m.	5,562.48	4,825.39	15.28%	5,562.48	4,825.39	15.28%
Convenience stores	3,841.32	3,319.80	15.71%	3,841.32	3,319.80	15.71%
Hypermarkets	686.35	659.37	4.09%	686.35	659.37	4.09%
Magnit Family	215.80	196.31	9.93%	215.80	196.31	9.93%
Drogerie Stores	819.01	649.91	26.02%	819.01	649.91	26.02%
Number of Customers, million	1,044.36	985.87	5.93%	2,988.50	2,850.44	4.84%
Convenience stores	882.10	831.52	6.08%	2,517.88	2,410.80	4.44%
Hypermarkets	62.66	65.78	(4.74%)	185.28	198.05	(6.45%)
Magnit Family	34.28	33.02	3.82%	99.16	94.40	5.04%
Drogerie Stores	65.32	55.55	17.58%	186.18	147.19	26.48%

LFLResults

	[4] 3Q2017 - 3Q2016
Formats	# ofStores	Average Ticket	Traffic	Sales
Convenience Stores	8,859	1.22%	(2.09)%	(0.90)%
Hypermarkets	221	(2.42)%	(6.76)%	(9.01)%
Magnit Family	159	(0.75)%	(5.69)%	(6.39)%

Drogerie	2,588	0.89%	(2.04)%	(1.17)%
Total	11,827	0.06%	(2.56)%	(2.50)%

	4 9M 2017 - 9M 2016
Formats	# ofStores	Average Ticket	Traffic	Sales
Convenience Stores	7,920	2.34%	(2.86)%	(0.59)%
Hypermarkets	221	(1.96)%	(9.65)%	(11.42)%
Magnit Family	158	(1.27)%	(7.97)%	(9.14)%
Drogerie	2,515	0.81%	0.27%	1.08%
Total	10,814	0.51%	(3.46)%	(2.97)%

3Q [5] and 9M 2017 ⁵ Key Financial Results, million RUR

	3Q2017	3Q2016	Growth Rate	9M2017	9M2016	Growth Rate
Net Sales	285,960.60	268,609.30	6.46%	840,985.43	790,136.88	6.44%
Convenience stores	211,976.66	197,689.55	7.23%	623,793.47	582,716.99	7.05%
Hypermarkets	35,844.78	38,338.25	(6.50)%	107,582.05	117,294.28	(8.28)%
Magnit Family	14,860.96	14,255.56	4.25%	43,588.10	41,748.97	4.41%
Drogerie Stores	19,995.58	16,998.98	17.63%	56,955.61	44,980.90	26.62%
Wholesale	3,282.61	1,326.96	147.38%	9,066.21	3,395.74	166.99%
Gross Profit	75,325.99	75,368.16	(0.06%)	227,872.48	217,431.15	4.80%
GrossMargin, %	26.34%	28.06%	n/a	27.10%	27.52%	n/a
EBITDAR	32,586.94	38,479.48	(15.31%)	103,103.93	108,441.45	(4.92%)
EBITDAR Margin, %	11.40%	14.33%	n/a	12.26%	13.72%	n/a
EBITDA	20,660.87	28,654.01	(27.90%)	69,450.80	80,253.85	(13.46%)
EBITDAMargin, %	7.23%	10.67%	n/a	8.26%	10.16%	n/a
EBIT	12,212.80	21,830.05	(44.06%)	44,555.12	61,328.52	(27.35%)
EBIT Margin, %	4.27%	8.13%	n/a	5.30%	7.76%	n/a
Net Income	6,923.15	14,816.36	(53.27%)	27,671.59	40,923.61	(32.38%)
Net Income Margin, %	2.42%	5.52%	n/a	3.29%	5.18%	n/a

3Qand 9M 2017 Key Financial Results, USD million [6]

	3Q2017	3Q2016	Growth Rate	9M2017	9M2016	Growth Rate
Netsales	4,845.19	4,156.46	16.57%	14,416.63	11,557.33	24.74%
Convenience stores	3,591.64	3,059.05	17.41%	10,693.41	8,523.40	25.46%
Hypermarkets	607.34	593.25	2.38%	1,844.23	1,715.66	7.49%
Magnit Family	251.80	220.59	14.15%	747.21	610.66	22.36%
Drogerie Stores	338.80	263.04	28.80%	976.36	657.94	48.40%
Wholesale	55.62	20.53	170.87%	155.42	49.67	212.90%
Gross Profit	1,276.29	1,166.25	9.44%	3,906.31	3,180.37	22.83%
GrossMargin, %	26.34%	28.06%	n/a	27.10%	27.52%	n/a
EBITDAR	552.14	595.43	(7.27%)	1,767.46	1,586.17	11.43%
EBITDAR Margin, %	11.40%	14.33%	n/a	12.26%	13.72%	n/a
EBITDA	350.07	443.39	(21.05%)	1,190.56	1,173.87	1.42%
EBITDAMargin, %	7.23%	10.67%	n/a	8.26%	10.16%	n/a
EBIT	206.93	337.80	(38.74)%	763.79	897.05	(14.86)%

EBIT Margin, %	4.27%	8.13%	n/a	5.30%	7.76%	n/a
Net Income	117.30	229.27	(48.84)%	474.36	598.59	(20.75)%
Net Income Margin, %	2.42%	5.52%	n/a	3.29%	5.18%	n/a

Notes:

• 1) Net revenue in USDterms is calculated using the average exchange rate for the period.
• 2) This announcement contains inside information which is disclosed in accordance with the MarketAbuse Regulation which came into effect on 3 July 2016.
• 3) Please note that there may be small variations in calculation of totals, subtotals and/ or percentage change due to rounding of decimals.

Forfurtherinformation, please contact:

Timothy Post	Head ofInvestor Relations Email: post@magnit.ru Office:+7-861-277-4554 x 17600
Dina Svishcheva	DeputyDirector, Investor Relations Email:Chistyak@magnit.ru Office:+7-861-277-4554 x 15101
MediaInquiries	Media Relations Department press@magnit.ru

Company description:

Public Joint Stock Company "Magnit"is one of Russia's leading retailers. Founded in 1994, the company is headquartered in the southern Russian city ofKrasnodar. As ofSeptember 30, 2017, Magnit operated 36 distribution centersand 15,697 stores (11,743 convenience, 432 hypermarkets and 3,522 drogeriestores) in 2,664 citiesand towns throughout 7 federalregions ofthe Russian Federation.

In accordance with thereviewed IFRS consolidated financialstatements for 1H2017, Magnit had revenues of RUB 555 billion and an EBITDAof RUB49 billion. Magnit's localshares 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+. Measured by market capitalization, Magnit is one ofthe largest retailers in Europe.

[1] Based onmanagementaccounts

[2] Excluding wholesale

[3] Based on the average exchange rate forJuly 2017 - 59.6707 RUBper 1USD,August 2017 - 59.6497 RUBper 1USD, September 2017 - 57.6953 RUBper 1USD [4] LFLcalculation base includes stores (all formats), which have been opened 12months prior to the last month of the reporting period. i.e. by September 1, 2016. [5] Unaudited Results

[6] Based on the average exchange rate for 3Q2017 - 59.0195 RUBper 1USD, 3Q2016 - 64.6245 RUBper 1USD, 9M 2017 - 58.3344 RUBper 1USD, 9M 2016 - 68.3667 RUBper 1USD

ISIN: US55953Q2021 Category Code: MSCU TIDM: MGNT LEICode: 2534009KKPTVL99W2Y12 OAM Categories:2.2. Inside information Sequence No.: 4765

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