Russian grocery retailer Magnit has seen its profits increase in the first half of 2011 after a recovery in the second quarter.

Magnit, which saw its first-quarter net income fall 7.5%, reported a 1.8% increase in half-year profits to RUB4.02bn. EBITDA increased by 35.7% to RUB10.2bn.

Sergey Galitskiy, Magnit’s CEO, said: "In the second quarter, the company was focused on efficiency. Negative trends that were outlined at the beginning of the year and led to the decrease of profitability in the first quarter of 2011 were overcome, which is reflected in the growth of EBITDA margin in the second quarter."

He added: "In the second half year the company will continue to develop in two key directions – increasing of market share and improving of operating efficiency."

The retailer reported in July that its revenue for the six months to the end of June was up by 51% to RUB156.5bn. The top-line growth was due to the number of stores increasing to 405, taking their total up to 4,460, as well as an 18.6% increase in like-for-like sales.

Despite the results, shares in Magnit dropped 2.8% as of 2pm (BST)

An analyst for Credit Suisse said Magnit's EBITDA came in line with consensus but added that, if a one-off payment is deducted from the results, the result missed forecasts.