RUSSIA: X5 Retail Group appoints CEO, sees FY sales rise

By Chris Mercer | 14 January 2013

  • Store openings lift net sales by 8.3% to RUB490.1bn (US$16.2bn)
  • DuCharme to become permanent CEO
  • CFO Balfe & soft discount manager to leave

The board of Russia's X5 Retail Group has nominated interim CEO Stephan DuCharme to take the post permanently, as new figures show that store openings lifted the firm's sales in 2012.

DuCharme, who's appointment is still subject to shareholder approval at X5 Retail's annual general meeting in April, said today (14 January) he is honoured to take on the role.

"2012 was a year of significant challenges and changes for the company," said DuCharme, who became interim CEO last July following the exit of Andrei Gusev.

"However, I think our ability to regroup in the second half of the year and deliver on our annual guidance demonstrates the strength of our asset base and validates the decisions we have made so far."

X5 has yet to publish full results for 2012, but it said today net sales rose by 8.3% for the 12 months to the end of December, to RUB490.1bn (US$16.2bn). Fourth-quarter sales rose by 8.6% on the same period of 2011, to RUB133.9bn.

However, sales in 2012 were driven by a 41% increase in net selling space versus 2011. No like-for-like sales figures were published today, leaving the group's progress in an increasingly competitive market open to question.

"We will continue to make the hard decisions and implement the necessary changes in 2013 to achieve the full potential of our stores," said DuCharme.

In other personnel changes announced today, X5 said its CFO, Kieran Balfe, will leave the company on 8 March, while its general director for soft discounters, Frank Mros, has resigned with immediate effect.

Balfe will be replaced by deputy commercial director Sergey Piven, subject to shareholder approval. Prior to joining X5 in 2011, Piven was CEO of Belmarket Co, a retail chain owned by A1, the private equity arm of Alfa Group.

Meanwhile, a search is underway to replace Mros.

Show the press release

X5 BOARD NOMINATES STEPHAN DUCHARME AS CEO CANDIDATE;
X5 ANNOUNCES Q4 AND FULL YEAR 2012 PRELIMINARY TRADING RESULTS
Amsterdam, 14 January 2013 – X5 Retail Group N.V. (“X5” or the “Company”), Russia's largest retailer in terms of sales (LSE ticker: “FIVE”), announced today the results of the Company’s Supervisory Board Meeting (the “Meeting”) held on Friday, 11 January 2013. At the Meeting, the Supervisory Board (the “Board”) nominated the Company’s acting CEO, Stephan DuCharme, to become statutory CEO subject to X5 shareholder approval at the Annual General Meeting to be held in April 2013.
The Board also agreed to accept Mr. DuCharme’s resignation as a Supervisory Board member effective immediately.
Mr. DuCharme commented, “I am very honored to have this opportunity to continue to be part of the ongoing transformation of X5 and the development of the Russian food retail market. 2012 was a year of significant challenges and changes for the Company however, I think our ability to regroup in the second half of the year and deliver on our annual guidance demonstrates the strength of our asset base and validates the decisions we have made so far. We will continue to make the hard decisions and implement the necessary changes in 2013 to achieve the full potential of our stores in order to take advantage of the market opportunities and deliver shareholder value.”
X5 announces Q4 and Full Year 2012 preliminary trading results
X5 is announcing preliminary trading results for the fourth quarter (Q4) and full year (FY) 2012 with net retail sales of Russian Rouble (RUR) 133,881.4 million (mln) and RUR 490,088.2 mln, respectively.
X5 plans to release the Q4 and Full Year 2012 Trading Update on 23 January 2013, with a conference call hosted by the CEO to provide additional detail on the results and other recent announcements.
Please see the table below for trading results highlights.
Q4 2012
Q4 2011
% change, y-o-y
FY 2012
FY 2011
% change, y-o-y
Net stores added
330
217
52.1%
800
533
50.1%
Net selling space added,
square meters (sq. m.)
104,323
85,677
21.8%
242,460
172,206
40.8%
Net retail sales, RUR mln
133,881.4
123,316.7
8.6%
490,088.2
452,482.4
8.3%

Original source: http://x5.ru/common/img/uploaded/files/2013.01.14_Results_of_Board_Meeting_Ducharme_Final_ENG.pdf

Sectors: Emerging markets, Retail

Companies: X5 Retail Group

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