REG - X5 Retail Group N.V - X5 forms strategic alliance with Krasny Yar, Slata

X5 Retail NVAnnouncement

02/08/2022 11:30

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RNS Number : 6291U  X5 Retail Group N.V.  02 August 2022

 

X5 AGREES ON STRATEGIC ALLIANCE WITH KRASNY YAR AND SLATA

 

Moscow, 2 August 2022 - X5 Retail Group N.V. ("X5" or the "Company", LSE and
MOEX ticker: FIVE), a leading Russian food retailer that operates the
Pyaterochka, Perekrestok and Chizhik retail chains, has agreed on the terms of
a strategic partnership with Krasny Yar and Slata groups, which are among the
leading retailers in Eastern Siberia. Requests for approval will be submitted
to the Federal Antimonopoly Service of Russia.

As part of the strategic alliance, X5 will acquire controlling stakes in both
groups. Upon receiving all the necessary permits from regulators, X5 will
obtain 70% of Krasny Yar's and Slata's businesses. The companies will continue
operating under their own brands and retain their business models. At the same
time, some processes will be integrated with X5 to achieve synergies,
including in procurement and logistics.

Krasny Yar Group includes 226 Krasny Yar and Baton stores in the Krasnoyarsk
Territory, Tyva and Khakassia with total retail space of 103,500 sq m, while
Slata accounts for 362 Slata and KhlebSol stores in the Irkutsk Region,
Buryatia and the Transbaikal Territory, with total retail space of
132,300 sq m. In addition, both groups are tenants of a total of
four distribution centres with a cumulative area of 56,200 sq m: one in
Krasnoyarsk, two in the Irkutsk Region and one in the Transbaikal Territory.

The deal will enable X5 to significantly expand its footprint in Eastern
Siberia. The Company launched its Pyaterochka chain in the Siberian Federal
District in August 2016, and it was operating 1,095 stores in the district as
at 30 June 2022. X5 also owns two distribution centres in the Siberian
Federal District.

"X5 invests in business development through partnerships with regional
leaders. While we seek to rely on their local expertise, our partners will
benefit from the capabilities of X5, as the nation's leading retailer, in
procurement, logistics, data processes and other practices. This collaboration
will enable us to improve the quality of our offering for Eastern Siberian
customers and ensure an uninterrupted supply of affordable products to the
region," said Igor Shekhterman, CEO of X5.

"Slata will have a powerful strategic investor and a strong partner operating
on a national scale. This will give us an opportunity to grow into a
best-in-class business, with potential to synergise our capabilities,
expertise and competencies while also delivering major improvements in the
product offering and customer services in territories where Slata and KhlebSol
operate," said Vyacheslav Zayats, Chairman of the Board of Directors of Slata
Group.

"In any partnership, the strengths of each party matter. Regional chains
better understand the needs of their customers and have the best locations,
while nationwide businesses have superior procurement expertise. This kind of
synergy will provide solid opportunities for our companies to further develop
this cooperation," commented Dmitry Saenko, Chairman of the Board of Directors
of Krasny Yar Group.

 

 

Note to Editors:

X5 Retail Group N.V. (LSE and MOEX: FIVE; RAEX: ruAA+) is a leading Russian
food retailer. The Company operates proximity stores under the Pyaterochka
brand, Perekrestok supermarkets and Chizhik hard discounters. X5 provides an
omnichannel experience to its customers, integrating retail stores and
e-commerce through its businesses Vprok.ru, 5Post and Mnogo Lososya.

As of 30 June 2022, X5 had 19,779 Company-operated stores. It has the leading
market position in both Moscow and St. Petersburg and a significant presence
in the European part of Russia. Its store base includes 18,558 Pyaterochka
proximity stores, 986 Perekrestok supermarkets and 153 Chizhik hard
discounters. The Company operates 48 DCs and 4,347 Company-owned trucks across
the Russian Federation.

X5 is one of the largest employers in Russia. The Company employs over 325
thousand people.

For the full year 2021, revenue totalled RUB 2,204,819 million (USD 29,935
million*), EBITDA pre-IFRS 16 reached RUB 161,024 million (USD 2,186
million*), and net profit pre-IFRS 16 for the period amounted to RUB 48,513
million (USD 659 million*). In H1 2022, revenue totalled RUB 1,252,180 million
(USD 16,412 million**), adjusted EBITDA pre-IFRS 16 reached RUB 104,909
million (USD 1,375 million**), and net profit pre-IFRS 16 amounted to RUB
33,731 million (USD 399 million**).

 

Forward-looking statements

This announcement includes statements that are, or may be deemed to be,
"forward-looking statements". These forward-looking statements can be
identified by the fact that they do not only relate to historical or current
events. Forward-looking statements often use words such as "anticipate",
"target", "expect", "estimate", "intend", "expected", "plan", "goal",
"believe", or other words of similar meaning.

By their nature, forward-looking statements involve risk and uncertainty
because they relate to future events and circumstances, a number of which are
beyond X5 Group N.V.'s control. As a result, actual future results may differ
materially from the plans, goals and expectations set out in these
forward-looking statements.

Any forward-looking statements made by or on behalf of X5 Group N.V. speak
only as of the date of this announcement. Save as required by any applicable
laws or regulations, X5 Group N.V. undertakes no obligation publicly to
release the results of any revisions to any forward-looking statements in this
document that may occur due to any change in its expectations or to reflect
events or circumstances after the date of this document.

* FX rate: 73.6541 USD/RUB

** FX rate: 76.2975 USD/RUB

 

 For further details please contact:
 Varvara Kiseleva                                                 Maria Yazeva

 Head of Corporate Finance and IR                                 Investor Relations Officer

 Tel.: +7 (495) 662-88-88 ext. 27-300                             Tel.: +7 (495) 662-88-88 ext. 13-147

 e-mail: Varvara.Kiseleva@x5.ru (mailto:Varvara.Kiseleva@x5.ru)   e-mail: Maria.Yazeva@x5.ru (mailto:Maria.Yazeva@x5.ru)

 

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