St. Petersburg, Russia; 18 February 2016 – Lenta Ltd (“Lenta” or the “Company”), one of the largest retail chains in Russia, today announces its audited consolidated IFRS results for the year ending 31 December 2015.

Download the full results release here
2015 Financial Highlights:

• Total sales grew 30.3% to Rub 252.8bn (2014: Rub 194.0bn) in line with the Company’s sales growth guidance;
• Adjusted EBITDA  of RUB 28.1bn, up 31.4% (2014: RUB 21.4bn) with a margin of 11.1% (2014: 11.0%);
• Gross margin of 22.3% (-0.2 p.p. vs. 2014) slightly decreased due to additional price investments in the second half of the year;
• SG&A decreased to 14.3% of sales (0.2 p.p. lower vs. 2014) thanks to continuous operational improvements and increased productivity which more than offset rising share of leased stores and associated rental expenses and increased depreciation expenses;
• Capital expenditures of RUB 31.4bn, a decrease of 10.7% compared to 2014 (RUB 35.1bn) linked to lower investments in land acquisition;
• Net cash generated from operating activities, before net interest and income taxes paid, of RUB 25.9bn compared to RUB 23.5bn in 2014 (an increase of 10.2%) primarily driven by EBITDA growth;
• Net interest expenses of RUB 9.3bn, an increase of 36.2% compared to 2014 (RUB 6.8bn) primarily due to higher interest rates and;
• Net Profit  of RUB 10.3bn, up 13.4% (2014: RUB 9.1bn) with a margin of 4.1%; and
• Net Debt of RUB 53.5bn as of 31 December 2015 (Net debt/Adjusted EBITDA of 1.9x).

2015 Operational Highlights:

• 32 hypermarkets and eight supermarkets opened during 2015, exceeding the Company’s guidance of at least 30 hypermarket openings;
• Total number of hypermarkets at 31 December 2015 was 140, with 32 supermarkets in operation, selling space was c. 882,383 sq.m. (+25.8% vs. 31 December 2014);
• Lenta opened a new distribution center (“DC”)  in Yekaterinburg  in October - its first DC in the Ural federal district;
• Like-for-like (“LFL”)  sales growth was 9.1% for 2015;
• LFL average ticket increased by 5.0% in 2015;
• LFL traffic increased by 3.9% in 2015; and
• The number of active loyalty cardholders  increased by 29% y-o-y to a total of 8.4mm as of 31 December 2015.

  Material events after the reported period:

• Lenta signed a Rub 7bn three-year fixed rate unsecured loan facility with Rosbank; and
• Opened two hypermarkets (in Grozny and Ufa) since the beginning of the year.

Lenta’s Chief Executive Officer, Jan Dunning said: 
“Lenta continues to deliver industry-leading sales growth and profitability against the back-drop of a challenging consumer and macro environment.
Lenta was Russia’s fastest growing large retailer in 2015 for the third consecutive year. We improved profitability despite additional price investments made in the second half to support traffic growth by reducing the effects of inflation on our customers. Adjusted EBITDA grew by over 31% and EBITDA margin improved by around 0.1 p.p to 11.1%. Our suppliers rewarded us for delivering strong growth and this enabled us to become even more competitive. I am especially delighted that the increase in profitability was enabled by sustainable operational improvements - productivity driven by optimization of processes and further development of our supply chain infrastructure. We see room for further efficiency improvements and will continue to drive synergies from the increasing scale of the business.
We substantially strengthened our balance sheet through a combination of the growth in profitability and the additional equity issues in 2015. We also significantly improved the maturity profile of our debt while benefiting from the fall in Mosprime rates and reduced margins under our major long-term loan facilities. Given Lenta’s healthy financial position and strong business performance we are well positioned to further accelerate our expansion. Our new store pipeline is stronger than ever and we continue to be confident in achieving our guidance to open at least 40 hypermarkets in 2016”.

Download the full results release here

For further information please visit www.lentainvestor.com/en/ or contact:

Lenta
Anna Meleshina, 
Public Relations & Government Affairs Director  
Tel: +7 812 363 28 53 
E-mail: anna.meleshina@lenta.com
Anastasia Kuznetsova, 
Corporate Communications Manager
Ňel:+7 (812) 336 39 97 
E-mail: a.kuznetsova@lenta.com

Citigate

David Westover
Senior Director
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+44 7768 897722 mobile
David.westover@citigatedr.co.uk
Marina Zakharova
Director
+44 207 282 1079 desk
+44 7774 256545
Marina.zakharova@citigatedr.co.uk