REG-O'KEY Group S.A. O`KEY GROUP REPORTS NET PROFIT GROWTH OF 16.2%, DA! DISCOUNTERS EBITDA MORE THAN DOUBLES IN FY 2022
18/04/2023 07:45
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O'KEY Group S.A. (OKEY)
O`KEY GROUP REPORTS NET PROFIT GROWTH OF 16.2%, DA! DISCOUNTERS EBITDA
MORE THAN DOUBLES IN FY 2022
18-Apr-2023 / 08:30 CET/CEST
The issuer is solely responsible for the content of this announcement.
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18 April 2023
O`KEY GROUP REPORTS NET PROFIT GROWTH OF 16.2%,
DA! DISCOUNTERS EBITDA MORE THAN DOUBLES IN FY 2022
O`KEY Group S.A. (AIX, LSE, MOEX: OKEY, the “Group”), one of Russia’s
leading food retailers, has announced its financial results for the full
year of 2022 based on audited consolidated financial statements.
All materials published by the Group are available on its website
1 okeygroup.lu.
All results are according to IFRS 16, unless stated otherwise.
FY 2022 financial highlights
• Total Group revenue increased by 8.1% YoY to RUB 202.2 bn
• Group gross profit rose by 11.1% to RUB 46.8 bn, and gross margin
improved by 0.7 pps YoY to 23.2%
• Group EBITDA grew by 9.8% YoY to RUB 17.0 bn, and EBITDA margin
increased by 0.1 pps YoY to 8.4%
• DA! discounters EBITDA surged 2.2 times YoY to RUB 3.6 bn, and EBITDA
margin reached 6.8%
• The Group’s operating profit grew by 15.2% YoY to RUB 5.8 bn
• The Group’s net profit increased by 16.2% YoY and amounted to
RUB 242 mln
Key events after the reporting period
• In March 2023, the Group’s global depositary receipts (GDRs) were
admitted to the quotation list in the main market segment on the
Astana International Exchange (AIX).
The full announcement is available at
2 https://www.okeygroup.lu/press-center/press-releases/2023/1836/.
Group Profit and Losses Highlights for FY 2022
RUB mln FY 2022 FY 2021 ∆ YoY, %
Total Group revenue 202,171 187,097 8.1%
O`KEY hypermarkets 148,824 152,260 (2.3%)
DA! discounters 53,347 34,837 53.1%
Gross profit 46,808 42,119 11.1%
Gross profit margin, % 23.2% 22.5% 0.7pps
SG&A (40,390) (35,718) 13.1%
SG&A as % of revenue 20.0% 19.1% 0.9pps
Other operating expenses, net (667) (1,410) (52.7%)
Operating profit 5,751 4,991 15.2%
Finance expenses, net (5,642) (4,798) 17.6%
Foreign exchange gain 313 206 51.9%
Net profit 242 208 16.2%
Group EBITDA 17,020 15,504 9.8%
Group EBITDA margin, % 8.4% 8.3% 0.1pps
O`KEY EBITDA 13,377 13,839 (3.3%)
O`KEY EBITDA margin, % 9.0% 9.1% (0.1pps)
DA! EBITDA 3,643 1,665 2.2x
DA! EBITDA margin, % 6.8% 4.8% 2pps
Group Revenue
RUB mln FY 2022 FY 2021 ∆ YoY, %
Total Group revenue 202,171 187,097 8.1%
Retail revenue 200,201 185,172 8.1%
Rental income 1,970 1,925 2.3%
In FY 2022, Group retail revenue grew by 8.1% YoY to RUB 200,201 mln,
driven by the expansion of the two chains, as well as DA! discounters' LFL
revenue and O`KEY's online revenue growth.
The Group’s rental income increased by 2.3% YoY and amounted to
RUB 1,970 mln in FY 2022. Total Group revenue was up by 8.1% YoY to
RUB 202,171 mln in FY 2022.
Group Net Retail Revenue and LFL Revenue
RUB mln 12M 2022 12M 2021 YoY, % LFL 2022/ 2021, %
O`KEY Group 200,201 185,172 8.1% 2.1%
O`KEY hypermarkets 146,904 150,383 (2.3%) (3.6%)
DA! discounters 53,297 34,789 53.2% 26.8%
For more details, please refer to the Group’s 3 Q4 and 12M 2022 Trading
Update.
Group Gross Profit
In FY 2022, Group gross profit rose by 11.1% YoY to RUB 46,808 mln, while
gross margin improved by 0.7 pps YoY to 23.2%. The improvement was made
possible by the Group’s effective procurement and logistics management,
timely efforts in reshaping the supply of products on offer, and
operational synergies between the formats.
In 2022, thanks to our long-term partnership with local suppliers, we
introduced new SKUs into our offering. Additionally, we successfully
phased out some of the imported SKUs, ensuring a diverse selection of
products at reasonable prices without sacrificing our margins.
Group Selling, General and Administrative Expenses
RUB mln FY 2022 % of revenue FY 2021 % of revenue ∆ YoY,
pps
Personnel costs 16,850 8.3% 15,388 8.2% 0.1
Depreciation and 10,662 5.3% 8,904 4.8% 0.5
amortisation
Communication and 4,587 2.3% 4,037 2.2% 0.1
utilities
Advertising and marketing 2,296 1.1% 1,992 1.1% -
Repairs and maintenance 1,582 0.8% 1,399 0.7% 0.1
Insurance and bank 1,260 0.6% 1,094 0.6% -
commissions
Operating taxes 766 0.4% 652 0.3% 0.1
Security expenses 785 0.4% 730 0.4% -
Legal and professional 651 0.3% 709 0.4% (0.1)
expenses
Materials and supplies 460 0.2% 409 0.2% -
Operating leases 448 0.2% 353 0.2% -
Other costs 43 - 51 - -
Total SG&A 40,390 20.0% 35,718 19.1% 0.9
The Group’s total SG&A expenses increased by 13.1% YoY to RUB 40,390 mln
in FY 2022. SG&A expenses as a percentage of revenue grew by 0.9 pps YoY
to 20.0% in FY 2022, driven mainly by depreciation and amortisation
expenses, personnel costs, and utilities expenses.
In FY 2022, personnel costs increased by 9.5% YoY to RUB 16,850 mln and,
as a percentage of revenue, by 0.1 pps YoY to 8.3%. The growth came mainly
on the back of new store openings in both chains, as well as wages
indexation in hypermarkets.
In FY 2022, D&A expenses rose by 19.7% YoY to RUB 10,662 mln, and by
0.5 pps YoY to 5.3% of revenue, driven primarily by the discounter chain
growth.
Communication and utilities expenses expanded by 13.6% YoY to
RUB 4,587 mln, and by 0.1 pps as a percentage of revenue, on the back of
utilities tariffs inflation, as well as new store openings.
Advertising and marketing expenses were up by 15.2% YoY to RUB 2,296 mln,
largely due to the planned replacement of advertising equipment in
hypermarkets.
Repairs and maintenance expenses rose by 13.1% YoY to RUB 1,582 mln, or by
0.1 pps YoY to 0.8% of revenue, mostly due to new store openings.
Group EBITDA and EBITDA Margin
The Group’s EBITDA grew by 9.8% YoY to RUB 17,020 mln, while EBITDA margin
improved by 0.1 pps YoY to 8.4% in FY 2022.
O`KEY hypermarkets EBITDA declined slightly by 3.3% YoY to RUB 13,377 mln
in FY 2022, mainly on the back of a 2.3% YoY decrease in net retail
revenue and cost inflation mentioned above, partially offset by higher
gross profit. O'KEY hypermarkets continued to be the foundation of our
business, contributing almost 79% of the Group’s EBITDA. In FY 2022,
EBITDA of O`KEY hypermarkets stood at 9.0%, 0.1 pps down from 9.1% seen in
FY 2021.
Overall, in 2022, the Company successfully adjusted the hypermarkets’
operations to accommodate the ongoing price inflation of raw materials,
decreased foot traffic, and more cautious and rational purchasing habits
of consumers. We substantially enhanced our product assortment and
introduced a variety of marketing activities to offer our customers an
excellent value for money and entice them into visiting our hypermarkets.
DA! discounters EBITDA demonstrated a 2.2x YoY growth to RUB 3,643 mln in
FY 2022, compared with RUB 1,665 mln in FY 2021. As the business continued
to ramp up, DA! EBITDA margin improved by 2.0 pps YoY and reached 6.8% in
FY 2022.
The considerable increase in the profitability of the format is backed by
stronger brand awareness and customer loyalty, consistently superior
price-to-quality ratio, availability of fresh products, and focus on the
Every Day Low Price policy to keep our products affordable to all
customers. A key element contributing to the DA! success is the prudent
selection of our own brands, comprising approximately 50% of the
discounters’ revenue.
Group Net Profit
Other operating expenses (net of income) decreased by 52.7% YoY to
RUB 667 mln in FY 2022. The decrease was mainly attributable to a
year-on-year decline in non-current assets impairment in the hypermarket
segment in FY 2022.
Net finance expenses increased by 17.6% YoY to RUB 5,642 mln in FY 2022,
driven predominantly by an increase in the weighted average interest rate
over the course of 2022. In addition, part of interest expenses was
attributable to non-current lease liabilities (under IFRS 16), which
increased in FY 2022.
In FY 2022, the Group recognised net foreign exchange gain of RUB 313 mln,
compared to RUB 206 mln in FY 2021. The Group's net foreign exchange gain
was chiefly attributable to lease contracts in foreign currencies, as well
as foreign exchange gain from import operations, while USD-denominated
intercompany loans with different functional currencies that were
eliminated on consolidation had a relatively small impact on the Group’s
results. The foreign exchange gain/loss is of non-cash nature.
In 2022, the Group’s net profit grew by 16.2% YoY to RUB 242 mln.
Group Cash Flow
RUB mln FY 2022 FY 2021
Net cash from operating activities 12,958 13,813
Net cash used in investing activities (6,468) (3,927)
Net cash used in financing activities (3,885) (8,137)
Net increase in cash and cash equivalents 2,605 1,749
Effect of exchange rate on cash and cash equivalents (274) (15)
Net cash from operating activities amounted to RUB 12,958 mln compared to
RUB 13,813 mln in FY 2021. The decline was mainly due to increased
investments in inventory stock in order to secure high level of on-shelf
products availability in the Group’s stores and online over 2022.
Net cash used in investing activities amounted to RUB 6,468 mln in FY 2022
vs RUB 3,927 mln of cash used in FY 2021. In 2022, the Group invested
approximately RUB 2.6 bn (excluding VAT) in the development of the
hypermarket business, including purchase of four stores in Moscow region,
and over RUB 4.0 bn (excluding VAT) in the development of DA! chain.
Net cash used in financing activities amounted to RUB 3,885 mln in
FY 2022, compared to RUB 8,137 mln of net cash used in financing
activities in FY 2021. The dynamics resulted from the Group's regular
credit portfolio refinancing, in particular a new bond issue in 2022.
As of 31 December 2022, the Group had RUB 16,467 mln of available credit
lines in Russian roubles with fixed and floating interest rates, in
respect of which all conditions have been met. If necessary, proceeds from
these facilities may be used to finance operating and investing
activities.
Group Net Debt Position
RUB mln As of 31 December As of 31 December
2022 2021
EBITDA 17,020 15,504
Total debt 45,486 37,817
Short-term debt1 9,961 6,172
Long-term debt 35,525 31,645
Cash & cash equivalents 11,779 9,448
Net debt 33,707 28,369
Total lease liabilities 22,545 24,063
Short-term lease liabilities 5,621 4,986
Long-term lease liabilities 16,924 19,077
Total interest-bearing liabilities 56,251 52,432
(net of сash & сash equivalents)
Total interest-bearing liabilities
(net of сash & сash equivalents) / 3.30x 3.38x
EBITDA
1 Short-term debt does not include interest accrued on loans and
borrowings.
The Group’s financial position remained strong during the reporting
period.
As of 31 December 2022, the total interest-bearing liabilities (net of
cash) to EBITDA ratio decreased to 3.30x from 3.38x as of
31 December 2021. As of 31 December 2022 and during the twelve-month
period then ended, the Group complied with all of its loan covenants.
Group audited consolidated IFRS report
The Group’s audited report, including the full set of audited IFRS
financial statements, can be found at
4 https://okeygroup.lu/investors/result-center/ifrs-statements/.
For more information, please contact:
For investors
Natalya Belyavskaya
Head of Investor Relations
+7 495 663 6677, ext. 266
5 Natalya.Belyavskaya@okmarket.ru
6 www.okeygroup.lu
ABOUT O`KEY GROUP
O`KEY Group S.A. (AIX, LSE, MOEX: OKEY) is one of the leading grocery
retailers in Russia, operating hypermarkets under the O`KEY brand and
discounters under the DA! brand.
As of 31 December 2022, the Group operated 273 stores across Russia (79
hypermarkets and 194 discounters) with the total selling space of 656,224
square meters. The Company opened its first hypermarket in St. Petersburg
in 2002 and has since demonstrated continuous growth. O`KEY was the first
Russian food retailer to launch e-commerce operations offering a full
range of hypermarket products for home delivery. The Group has nine
e-commerce pick-up points in Moscow and seventeen e-commerce pick-up
points in St. Petersburg. In 2015, the Group launched the first discount
chain in Russia under the DA! brand. The Group operates five distribution
centres in Russia – three in Moscow and two in St. Petersburg. The Group
employs 21,900 people.
In 2022, the Group’s revenue amounted to RUB 202.2 bn, and EBITDA reached
RUB 17.0 bn.
The O`KEY Group shareholder structure is as follows: NISEMAX Co Ltd –
49.11%. GSU Ltd – 34.14%, free-float and other holders – 16.75%.
DISCLAIMER
These materials contain statements about future events and expectations
that are forward-looking statements. These statements typically include
words such as ‘expects’ and ‘anticipates’ and words of similar import. Any
statement in these materials that is not a statement of historical fact is
a forward-looking statement that involves known and unknown risks,
uncertainties and other factors that may cause our actual results,
performance or achievements to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements.
None of the future projections, expectations, estimates or prospects in
this announcement should be taken as forecasts or promises, nor should
they be taken as implying any indication, assurance or guarantee that the
assumptions on which such future projections, expectations, estimates or
prospects have been prepared are correct or exhaustive or, in the case of
the assumptions, fully stated in this announcement. We assume no
obligations to update the forward-looking statements contained herein to
reflect actual results, changes in assumptions or changes in factors
affecting these statements.
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Dissemination of a Regulatory Announcement that contains inside
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The issuer is solely responsible for the content of this announcement.
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ISIN: US6708662019
Category Code: ACS
TIDM: OKEY
LEI Code: 213800133YYU23T4L791
OAM Categories: 1.1. Annual financial and audit reports
Sequence No.: 237439
News ID: 1609617
End of Announcement EquityStory RS News Service
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