X5 Retail Group, Russia’s largest retailer by sales, has lowered its forecast for full-year sales growth.
The company now expects sales for the year to grow by 35%, down from an initial forecast of 40%, blaming “unstable economic conditions in Russia and worldwide”.
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The revised forecast, announced in the retailer’s third quarter results yesterday (10 October), is despite net retail sales increasing 32% year-on-year to RUR104.9bn (US$3.3bn) in the three months ending 30 September.
The fall in sales growth is likely to arise as a result of an acceleration of promotional activity.
A statement said: “In an effort to support our customer base in an uneasy economic environment, we are increasing the pace of promo-campaign in Q4 2011 that, together with a comprehensive aged stock clearance, could adversely affect X5’s margins.”
The group also noted that customer traffic dropped 4%, but said this was offset by an 8% rise in the average basket spend.
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By GlobalDataIn the first nine months of the year, the company increased the number of stores by 316 and rebranded 613 Kopeyka stores, which the company bought in a US$1.6bn deal in December.
