Support The Moscow Times!

X5 Expects to Recover From Q1 Slump

X5 Retail, Russia's biggest food retailer by sales, posted a sharp slowdown in first-quarter sales growth, blaming underinvestment in advertising, though it kept its revenue and margin targets for the full year.

The company, in which Alfa Group owns a 47.86 percent share, said Wednesday that sales at stores open for at least a year dropped 3.9 percent in January through March, after a 2 percent fall in the previous quarter.

Total sales grew 4.4 percent in ruble terms to 116.9 billion rubles ($3.9 billion).

The pace of growth was down from 16 percent in the fourth quarter of 2011 and 32 percent in the third.

Rival Magnit, in contrast, reported a 4.1 percent rise in first-quarter like-for-like sales Tuesday after 3.1 percent growth in the fourth quarter of 2011.

X5 said it saw an improvement in customer traffic in March, compared with a decline of 4.6 percent for the whole of the quarter, and predicted better quarter-on-quarter results for the rest of 2012.

It confirmed its 2012 outlook for sales growth in a 15 percent to 20 percent range and an EBITDA margin of more than 7 percent.

X5 said the sales rise from its organic expansion was 8.3 percent in the quarter, when it opened 137 stores, bringing its total number of self-operated outlets to 3,139.

Read more

Independent journalism isn’t dead. You can help keep it alive.

The Moscow Times’ team of journalists has been first with the big stories on the coronavirus crisis in Russia since day one. Our exclusives and on-the-ground reporting are being read and shared by many high-profile journalists.

We wouldn’t be able to produce this crucial journalism without the support of our loyal readers. Please consider making a donation to The Moscow Times to help us continue covering this historic time in the world’s largest country.