Russia’s leading food retailer Pyaterochka today (4 September) posted a 52% increase in first half EBITDA, to US$149m, stating that the completion on its recent merger with Perekryostok meant it is well positioned for future growth.
The merger of Pyaterochka and Perekryostok was completed in May, creating Russia’s largest grocery retailer with more than 1,000 stores across the country.
The group reported pro forma sales of $1,581m – up 43% year-on-year – and gross margins of 26.6%, up from 24.5% last year. During the half, Pyaterochka said, the chain opened 135 new stores, and improved supply chain management through opening two new logistics centres in St Petersburg and Moscow. Meanwhile, the company reported that like-for-like sales were up 10% across the group.
“The financial performance of Pyaterochka in the first half of 2006 clearly shows our growth continuing unabated,” Chief Financial Officer Vitaly Podolski said.
The merged group has secured funding for further expansion through an $800m unsecured syndicated loan, in the process cutting its cost of capital.
The company’s net profit fell to $62.1m, from $68.1m, due to the company’s heavy investment in extending its store network and developing its format.