RUSSIA: O'Key profits up despite higher costs
Russian retailer O'Key has hailed a successful year so far after reporting a 12% rise in half-year profits despite a difficult trading environment.
The group posted profits of RUB1.08bn (US$37.5m) in its results for the six months leading up to 30 June, a 12.1% increase on the same period in 2010. EBITDA was RUB2.7bn, which also equated to a 12.1% jump.
Sales, meanwhile, were up 11.9% to RUB42.7bn from last year, O'Key said yesterday (31 August).
O'Key suffered a setback in January when the roof of a store in St. Petersburg collapsed under the weight of snow, killing a woman and injuring 13 people. The group closed 25 of its stores in the city for safety checks in the aftermath of the accident.
O'Key CEO Patrick Longuet said: "1H 2011 was a challenging period for O'Key both in terms of the macroeconomic environment and the accident at one of our St. Petersburg stores. These factors created strong pressure on both our revenue and profitability in the first half of the year.
“Macroeconomic conditions were characterised by high inflation and slower growth in real wages. These factors had a negative impact on our business, which was already under pressure following the accident.
“Nevertheless, in the first half of 2011 we took measures to minimise the effect of adverse market conditions on our business, regained customers following the accident and continued to progress on store roll-out plan."
Russian food retailer O'Key has announced an increase in annual like-for-like sales....
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