Magnit

Earnings Release • Oct 9, 2015

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PJSC MAGNIT - Magnit September / 9M 2015 Results

PR Newswire

London, October 9

Press-release

Krasnodar

October 9, 2015

PJSC “Magnit” Announces 19.31% Retail Sales Growth in Rubles for September 2015[1]****

Krasnodar, October 9, 2015: PJSC “Magnit”, Russia’s largest food retailer (the “Company”; MOEX and LSE: MGNT) announces 19.31% retail sales growth in rubles for September 2015.

During September 2015 the Company opened (net) 218 stores. The total store base reached 11,388 stores (9,246 convenience stores, 208 hypermarkets, 127 “Magnit Family” stores and 1,807 drogerie stores).

Preliminary consolidated unaudited net retail revenue (excl. VAT) in 9M 2015 increased by 26.99% in ruble terms (compared to 9M 2014) and stood at 688,648.23 million rubles.

According to Rosstat, food inflation in September 2015 amounted to 0.4%, which is 60 b. p. lower than in September 2014 (1.0%). Food inflation in 9M2015 stood at 10.2% compared to 8.4% in 9M2014.

General inflation in September 2015 amounted to 0.6% compared to 0.7% in September 2014, in 9M2015 10.4% compared to 6.3% in 9M2014.

September 2015 Key Operating and Financial Highlights:

	September 2015	September 2014	Growth Rate
Number of opened stores, NET	218	121	n/a
convenience stores	119	79	n/a
hypermarkets	1	3	n/a
magnit family	5	6	n/a
drogerie stores	93	33	n/a
Total number of stores	11,388	9,020	n/a
convenience stores	9,246	7,891	n/a
hypermarkets	208	175	n/a
magnit family	127	68	n/a
drogerie stores	1,807	886	n/a
Selling space, eop, th. sq. m.	4,154.99	3,327.00	24.89%
convenience stores	2,997.30	2,519.71	18.95%
hypermarkets	604.96	521.98	15.90%
magnit family	139.82	78.83	77.36%
drogerie stores	412.92	206.48	99.98%
Selling space growth, th. sq.m.	73.90	48.88	n/a
convenience stores	46.01	25.05	n/a
hypermarkets	1.84	9.75	n/a
magnit family	4.91	7.12	n/a
drogerie stores	21.15	6.97	n/a
Number of customers, million	279.58	245.11	14.06%
convenience stores	237.62	213.55	11.27%
hypermarkets	20.71	19.01	8.95%
magnit family	8.47	5.25	61.19%
drogerie stores	12.78	7.30	75.16%
Net retail sales, million RUR	74,098.54	62,106.39	19.31%
convenience stores	55,151.39	47,440.04	16.25%
hypermarkets	11,762.88	10,743.74	9.49%
magnit family	3,510.84	2,125.71	65.16%
drogerie stores	3,673.43	1,796.90	104.43%
Net retail sales, million US$[2]	1,109.68	1,639.70	(32.32)%
convenience stores	825.93	1,252.49	(34.06)%
hypermarkets	176.16	283.65	(37.90)%
magnit family	52.58	56.12	(6.32)%
drogerie stores	55.01	47.44	15.96%

3Q and 9M 2015 Key Operating and Financial Highlights:

	3Q 2015	3Q 2014	Growth Rate	9M 2015	9M 2014	Growth Rate
Number of opened stores, NET	660	402	n/a	1,677	927	n/a
convenience stores	356	277	n/a	902	691	n/a
hypermarkets	7	6	n/a	18	14	n/a
magnit family	17	11	n/a	30	22	n/a
drogerie stores	280	108	n/a	727	200	n/a
Total number of stores	11,388	9,020	n/a	11,388	9,020	n/a
convenience stores	9,246	7,891	n/a	9,246	7,891	n/a
hypermarkets	208	175	n/a	208	175	n/a
magnit family	127	68	n/a	127	68	n/a
drogerie stores	1,807	886	n/a	1,807	886	n/a
Selling space, eop. th. sq. m.	4,154.99	3,327.00	24.89%	4,154.99	3,327.00	24.89%
convenience stores	2,997.30	2,519.71	18.95%	2,997.30	2,519.71	18.95%
hypermarkets	604.96	521.98	15.90%	604.96	521.98	15.90%
magnit family	139.82	78.83	77.36%	139.82	78.83	77.36%
drogerie stores	412.92	206.48	99.98%	412.92	206.48	99.98%
Selling space growth, th. sq.m.	226.99	137.79	n/a	564.35	315.62	n/a
convenience stores	131.05	86.05	n/a	323.99	207.51	n/a
hypermarkets	15.15	17.44	n/a	45.87	39.10	n/a
magnit family	17.09	11.80	n/a	30.75	25.57	n/a
drogerie stores	63.71	22.49	n/a	163.75	43.44	n/a
Number of customers, million	863.42	758.35	13.86%	2,481.04	2,158.82	14.93%
convenience stores	732.07	661.02	10.75%	2,119.29	1,890.94	12.08%
hypermarkets	66.38	60.13	10.38%	194.29	173.08	12.25%
magnit family	25.89	15.85	63.36%	71.22	41.26	72.61%
drogerie stores	39.08	21.35	83.08%	96.24	53.54	79.77%
Net retail sales, million RUR	234,950.17	193,384.54	21.49%	688,648.23	542,288.27	26.99%
convenience stores	173,911.85	147,390.87	17.99%	512,345.61	414,372.92	23.64%
hypermarkets	38,897.03	34,341.49	13.27%	118,268.16	98,349.79	20.25%
magnit family	10,979.38	6,428.94	70.78%	31,316.20	16,510.65	89.67%
drogerie stores	11,161.91	5,223.24	113.70%	26,718.26	13,054.92	104.66%
Net retail sales, million US$[3]	3,730.65	5,343.46	(30.18)%	11,617.32	15,324.16	(24.19)%
convenience stores	2,761.45	4,072.59	(32.19)%	8,643.14	11,709.49	(26.19)%
hypermarkets	617.62	948.90	(34.91)%	1,995.15	2,779.20	(28.21)%
magnit family	174.34	177.64	(1.86)%	528.30	466.56	13.23%
drogerie stores	177.23	144.32	22.80%	450.73	368.91	22.18%

LFL results

Formats	3Q 2015 - 3Q 2014[4]
# of Stores	Average Ticket	Traffic	Sales
Convenience Stores	7,359	6.40%	(2.10)%	4.16%
Hypermarkets	171	4.01%	(4.63)%	(0.81)%
Magnit Family	60	2.98%	(4.38)%	(1.53)%
Drogeries	812	15.20%	5.79%	21.88%
Total	8,402	5.80%	(2.14)%	3.54%

Formats	9M 2015 - 9M 2014[4]
# of Stores	Average Ticket	Traffic	Sales
Convenience Stores	7,087	10.06%	(0.74)%	9.24%
Hypermarkets	170	8.04%	(2.46)%	5.38%
Magnit Family	60	7.18%	(2.24)%	4.78%
Cosmetics Stores	764	13.35%	8.99%	23.54%
Total	8,081	9.44%	(0.69)%	8.69%

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: +7-861-277-4562
Dina Svishcheva	Deputy Director, Investor Relations Email: Chistyak@magnit.ru Office: +7-861-277-45-54 x 15101 Mobile: +7-961-511-0202 Direct Line: +7-861-277-4562
Media Inquiries	PR and GR Department press@magnit.ru

Company description:

Magnit is Russia's largest food retailer. Founded in 1994, the company is headquartered in the southern Russian city of Krasnodar. As of September 30, 2015, Magnit operated 29 distribution centers and about 11,400 stores (9,246 convenience, 335 hypermarkets, and 1,807 drogerie stores) in approximately 2,297 cities and towns throughout 7 federal regions of the Russian Federation.

In accordance with the reviewed IFRS consolidated financial statements for 1H 2015. Magnit had revenues of RUB 455 billion and an EBITDA of RUB 49 billion. Magnit's local shares are traded on the Moscow Stock 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 of the largest retailers in Europe.

[1] According to management accounts

[2] Based on the average exchange rate for September 2015 - 66.7749 RUB per 1 USD, September 2014 – 37.8766 RUB per 1 USD

[3] Based on the average exchange rate for 3Q 2015 - 62.9784 RUB per 1 USD, 3Q 2014 – 36.1909 RUB per 1 USD, 9M 2015 – 59.2777 RUB per 1 USD, 9M 2014 – 35.3878 RUB per 1 USD

[4] LFL calculation base includes stores (all formats), which have been opened 12 months prior to the last month of the reporting period. i.e. by September 1, 2014.