REG - X5 Retail Group N.V - X5 reports 18.6% revenue growth in Q2 2022
02/08/2022 08:00
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RNS Number : 5284U X5 Retail Group N.V. 02 August 2022
X5 reports 18.6% revenue growth in Q2 2022
9.6% adj. EBITDA margin pre-IFRS 16
Key highlights:
+18.6 % y-o-y
Revenue growth in Q2 2022
driven by solid like-for-like (LFL)(1) sales and selling space expansion
+38.4 % y-o-y
Digital business (express delivery, Vprok.ru, 5Post and Mnogo Lososya) net
sales growth in Q2 2022
Digital business net sales amounted to RUB 14.7 billion, which comprised 2.3%
of consolidated Q2 2022 revenue
25.8 % +14 b.p.
Gross margin under IFRS 16 in Q2 2022
(+19 b.p. to 25.5% pre-IFRS 16(2))
driven predominantly by lower logistics costs and a reduction in shrinkage
14.0 % +92 b.p.
Adjusted EBITDA(3) margin under IFRS 16 in Q2 2022
(+132 b.p. to 9.6% pre-IFRS 16)
4.1% +140 b.p.
Net profit margin under IFRS 16 in Q2 2022
(97 b.p. to 3.9% pre-IFRS 16)
2.58x
Net debt/EBITDA ratio as of 30 June 2022 (under IFRS 16)
(1.11x pre-IFRS 16)
Amsterdam, 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, today released its
unaudited condensed consolidated interim financial information for the three
months (Q2) and six months (H1) ended 30 June 2022, in accordance with
International Financial Reporting Standards as adopted by the European Union.
Igor Shekhterman, X5 Chief Executive Officer, commented:
"During the first half of 2022, we focused on ensuring the operational
stability of our business, including by making necessary adjustments to
logistics and assortment. We also made price investments into socially
important categories of goods to offset accelerating inflation, which, coupled
with lower bonuses from suppliers, led to a slight decline in the commercial
margin. This decline was offset by a positive operating leverage effect, as
well as by our successful implementation of stringent cost control measures.
As a result, in Q2 2022, we achieved exceptionally strong margins and are well
positioned to continue with our price investment approach, as well as to
accelerate investments into future growth, including into major projects like
the development of the Chizhik and Pyaterochka retail networks.
"Against the backdrop of strong margins posted in Q2 2022, we anticipate that
ongoing price investments and the adaptation of our product assortment -
including the diversification of our supplier base and the development of X5's
private labels, which are seeing growing customer demand - will contribute to
margins stabilising at lower levels in H2 2022. We also plan the resumption of
investments into business growth and expansion.
"In the second half of the year, X5 will focus on enhancing its customer value
proposition, boosting like-for-like sales and growing its market share.
"We will prioritise the expansion of our Chizhik hard discounter format, which
saw a 30-fold increase in revenue year-on-year in H1 2022 and is showing
results above our expectations. We aim to accelerate Chizik expansion plans
and open over 400 new hard discounter stores in 2022. We believe that Chizhik
serves an important function by providing a wide range of customers with
access to affordable and reasonably priced basic goods, and one of our main
goals at this time is to accelerate the development of this format.
"We will also continue to develop the Pyaterochka proximity store network,
where we aim to open over 1,400 proximity stores (gross) for the full year
2022. Further, we will focus on developing our consolidated online business
including through new partnerships with profitability, efficiency and customer
convenience in mind.
"At the same time, the changing market conditions are offering new
opportunities for growth, including through M&A. For example, in June, X5
acquired 15 PRISMA supermarkets in St Petersburg. This move will see the
stores integrated into X5's Perekrestok supermarket network and will expand
X5's customer offering. Moving forward, we will continue to look for
attractive inorganic growth opportunities arising in the market."
Profit and loss statement highlights(4)
RUB mln IFRS 16 Pre-IFRS 16
Q2 2022 Q2 2021 change, Q2 2022 Q2 2021 change,
y-o-y, %
y-o-y, %
Revenue 647,950 546,512 18.6 647,950 546,512 18.6
incl. net retail sales(5) 646,162 544,409 18.7 646,162 544,409 18.7
Pyaterochka (incl. express delivery) 534,318 447,611 19.4 534,318 447,611 19.4
Perekrestok (incl. Vprok.ru and express delivery) 100,041 87,865 13.9 100,041 87,865 13.9
Karusel 4,464 8,454 (47.2) 4,464 8,454 (47.2)
Chizhik 6,818 245 28x 6,818 245 28x
Gross profit 167,016 140,096 19.2 164,957 138,090 19.5
Gross profit margin, % 25.8 25.6 14 b.p. 25.5 25.3 19 b.p.
Adj. EBITDA 91,013 71,728 26.9 62,376 45,424 37.3
Adj. EBITDA margin, % 14.0 13.1 92 b.p. 9.6 8.3 132 b.p.
EBITDA 90,152 70,333 28.2 61,515 44,029 39.7
EBITDA margin, % 13.9 12.9 104 b.p. 9.5 8.1 144 b.p.
Operating profit 51,578 33,303 54.9 41,519 25,371 63.6
Operating profit margin, % 8.0 6.1 187 b.p. 6.4 4.6 177 b.p.
Net profit 26,762 14,920 79.4 25,442 16,133 57.7
Net profit margin, % 4.1 2.7 140 b.p. 3.9 3.0 97 b.p.
RUB mln IFRS 16 Pre-IFRS 16
H1 2022 H1 2021 change, H1 2022 H1 2021 change,
y-o-y, %
y-o-y, %
Revenue 1,252,180 1,053,703 18.8 1,252,180 1,053,703 18.8
incl. net retail sales(6) 1,247,938 1,050,192 18.8 1,247,938 1,050,192 18.8
Pyaterochka (incl. express delivery) 1,023,511 854,321 19.8 1,023,511 854,321 19.8
Perekrestok (incl. Vprok.ru and express delivery) 202,615 177,003 14.5 202,615 177,003 14.5
Karusel 9,894 18,204 (45.7) 9,894 18,204 (45.7)
Chizhik 10,917 363 30x 10,917 363 30x
Gross profit 317,446 269,637 17.7 313,429 265,715 18.0
Gross profit margin, % 25.4 25.6 (24) b.p. 25.0 25.2 (19) b.p.
Adj. EBITDA 161,192 133,384 20.8 104,908 80,899 29.7
Adj. EBITDA margin, % 12.9 12.7 21 b.p. 8.4 7.7 70 b.p.
EBITDA 159,708 131,560 21.4 103,424 79,075 30.8
EBITDA margin, % 12.8 12.5 27 b.p. 8.3 7.5 76 b.p.
Operating profit 77,768 57,803 34.5 58,625 42,239 38.8
Operating profit margin, % 6.2 5.5 72 b.p. 4.7 4.0 67 b.p.
Net profit 29,261 22,558 29.7 30,464 25,296 20.4
Net profit margin, % 2.3 2.1 20 b.p. 2.4 2.4 3 b.p.
Revenue
Revenue growth reached 18.6% year-on-year in Q2 2022. Net retail sales
increased by 18.7%, driven by a combination of 7.1% selling space growth and
11.7% LFL sales growth, while X5's digital business sales grew by 38.4% y-o-y.
Selling space by format, square metres (sqm)
AS AT 30-JUN-22 AS AT 31-DEC-21 CHANGE AS AT 30-JUN-21 CHANGE Y-O-Y, % OR MULTIPLE
VS 31-DEC-21, %
Pyaterochka 7,271,291 7,048,488 3.2 6,782,960 7.2
Perekrestok 1,109,171 1,098,905 0.9 1,058,533 4.8
Karusel 100,931 128,063 (21.2) 160,923 (37.3)
Chizhik 44,129 20,327 117.1 4,008 11x
X5 Group(7) 8,639,691 8,409,757 2.7 8,065,772 7.1
Q2 and H1 2022 LFL store performance by format, % change y-o-y
In Q2 2022, LFL sales performance accelerated year-on-year to 11.7%, supported
by solid LFL results at Pyaterochka and Perekrestok at 12.3% and 9.0%,
respectively, on the back of accelerating inflation.
The LFL basket was the main driver of LFL sales in Q2 2022, with LFL traffic
in positive territory at 0.6% year-on-year, and with Pyaterochka showing 0.9%
year-on-year growth.
Q2 2022 H1 2022
SALES TRAFFIC BASKET SALES TRAFFIC BASKET
Pyaterochka 12.3 0.9 11.4 12.5 2.4 9.9
Perekrestok 9.0 (1.5) 10.6 8.5 (0.6) 9.1
Karusel (14.6) (16.0) 1.6 (9.3) (14.7) 6.3
X5 Group 11.7 0.6 11.0 11.7 2.0 9.5
For more details on net retail sales performance, please refer to X5's Q2 2022
Trading Update
(https://www.x5.ru/wp-content/uploads/2022/07/q2_2022_trading_update_eng.pdf)
.
(https://www.x5.ru/ru/PublishingImages/Pages/Media/News/Trading_Update_Q3%202021__RUS.pdf)
Gross profit margin
Gross profit margin under IFRS 16 increased by 14 b.p. year-on-year to 25.8%
(increased by 19 b.p. year-on-year to 25.5% pre-IFRS 16) in Q2 2022, mainly
driven by lower logistics costs due to the positive operating leverage effect
and a reduction in shrinkage as a result of operating improvements.
Gross profit margin for H1 2022 decreased by 24 b.p. under IFRS 16 (decreased
by 19 b.p pre-IFRS 16), affected primarily by a decline in commercial margin
on the back of price investments. The latter was a result of the decreased
level of suppliers' promo activity, driven predominantly by the current market
environment, including the withdrawal of certain suppliers.
Selling, general and administrative (SG&A) expenses (excl. D&A&I
and the impact of the Karusel transformation)
IFRS 16 Pre-IFRS 16
RUB mln Q2 2022 Q2 2021 change, Q2 2022 Q2 2021 change,
y-o-y, %
y-o-y, %
Staff costs (50,210) (44,499) 12.8 (50,210) (44,499) 12.8
% of revenue 7.7 8.1 (39) b.p. 7.7 8.1 (39) b.p.
incl. LTI and share-based payments (685) (1,184) (42.1) (685) (1,184) (42.1)
staff costs excl. LTI and share- 7.6 7.9 (28) b.p. 7.6 7.9 (28) b.p.
based payments as % of revenue
Lease expenses (4,859) (3,505) 38.6 (29,054) (26,182) 11.0
% of revenue 0.7 0.6 11 b.p. 4.5 4.8 (31) b.p.
Utilities (11,122) (10,213) 8.9 (11,122) (10,213) 8.9
% of revenue 1.7 1.9 (15) b.p. 1.7 1.9 (15) b.p.
Other store costs (5,784) (5,642) 2.5 (6,001) (5,860) 2.4
% of revenue 0.9 1.0 (14) b.p. 0.9 1.1 (15) b.p.
Third-party services (3,425) (4,775) (28.3) (3,329) (4,640) (28.3)
% of revenue 0.5 0.9 (35) b.p. 0.5 0.8 (34) b.p.
Other expenses (7,274) (6,414) 13.4 (9,113) (7,559) 20.6
% of revenue 1.1 1.2 (5) b.p. 1.4 1.4 2 b.p.
SG&A (excl. D&A&I and the impact of the Karusel transformation) (82,674) (75,048) 10.2 (108,829) (98,953) 10.0
% of revenue 12.8 13.7 (97) b.p. 16.8 18.1 (131) b.p.
SG&A (excl. D&A&I, LTI, share-based payments and the impact of the (81,989) (73,864) 11.0 (108,144) (97,769) 10.6
Karusel transformation)
% of revenue 12.7 13.5 (86) b.p. 16.7 17.9 (120) b.p.
IFRS 16 Pre-IFRS 16
RUB mln H1 2022 H1 2021 change, H1 2022 H1 2021 change,
y-o-y, %
y-o-y, %
Staff costs (100,288) (87,983) 14.0 (100,288) (87,983) 14.0
% of revenue 8.0 8.3 (34) b.p. 8.0 8.3 (34) b.p.
incl. LTI and share-based payments (1,061) (1,606) (33.9) (1,061) (1,606) (33.9)
staff costs excl. LTI and share-based payments as % of revenue 7.9 8.2 (27) b.p. 7.9 8.2 (27) b.p.
Lease expenses (8,788) (6,407) 37.2 (57,222) (51,470) 11.2
% of revenue 0.7 0.6 9 b.p. 4.6 4.9 (31) b.p.
Utilities (24,989) (22,160) 12.8 (24,989) (22,160) 12.8
% of revenue 2.0 2.1 (11) b.p. 2.0 2.1 (11) b.p.
Other store costs (11,404) (10,812) 5.5 (11,840) (11,245) 5.3
% of revenue 0.9 1.0 (12) b.p. 0.9 1.1 (12) b.p.
Third-party services (7,939) (9,027) (12.1) (7,748) (8,862) (12.6)
% of revenue 0.6 0.9 (22) b.p. 0.6 0.8 (22) b.p.
Other expenses (15,701) (12,762) 23.0 (18,677) (14,804) 26.2
% of revenue 1.3 1.2 4 b.p. 1.5 1.4 9 b.p.
SG&A (excl. D&A&I and impact from the Karusel transformation) (169,109) (149,151) 13.4 (220,764) (196,524) 12.3
% of revenue 13.5 14.2 (65) b.p. 17.6 18.7 (102) b.p.
SG&A (excl. D&A&I, LTI, share-based payments and impact from the (168,048) (147,545) 13.9 (219,703) (194,918) 12.7
Karusel transformation)
% of revenue 13.4 14.0 (58) b.p. 17.5 18.5 (95) b.p.
In Q2 2022, SG&A expenses excluding D&A&I, LTI, share-based
payments and the impact of the Karusel transformation under IFRS 16 as a
percentage of revenue decreased by 86 b.p. to 12.7% (decreased by 120 b.p. to
16.7% pre-IFRS 16), mainly driven by lower staff costs, utilities, other store
costs and third-party services as a result of operating leverage as well as
cost control measures.
Staff costs (excluding LTI and share-based payments) as a percentage of
revenue decreased by 39 b.p. year-on-year in Q2 2022 to 7.7%, mainly due to
the operating leverage effect on the back of accelerated revenue growth in Q2
2022, as well as operational improvements.
LTI and share-based payment expenses amounted to RUB 685 million in Q2 2022,
mostly attributed to the reinstated LTI programme, which is currently being
redesigned.
Lease expenses under IFRS 16 as a percentage of revenue in Q2 2022 increased
by 11 b.p. year-on-year to 0.7%, mainly due to a higher number of
revenue-linked leases and reverse franchising agency fees. The decrease in
pre-IFRS 16 lease expenses by 31 b.p. to 4.5% was caused by a positive
operational leverage effect and measures taken to reduce lease expenses,
partially compensated by a higher number of revenue-linked leases.
Utilities costs as a percentage of revenue in Q2 2022 decreased by 15 b.p.
year-on-year to 1.7%, mainly due to colder than usual weather conditions in
May-June, as well as improved control of climate equipment settings and
optimisation initiatives.
Other store costs under IFRS 16 as a percentage of revenue in Q2 2022
decreased by 14 b.p. year-on-year (falling by 15 b.p. pre-IFRS 16), mainly due
to the positive operating leverage effect.
Third-party service expenses under IFRS 16 as a percentage of revenue in Q2
2022 decreased by 35 b.p. year-on-year to 0.5% (down 34 b.p. to 0.5% pre-IFRS
16), mainly due to lower marketing expenses.
Other expenses under IFRS 16 as a percentage of revenue in Q2 2022 decreased
by 5 b.p. year-on-year to 1.1% (up 2 b.p. to 1.4% pre-IFRS 16), mainly due to
lower business travel expenses offset under pre-IFRS 16 by increased reverse
franchising agency fees.
In H1 2022, SG&A expenses excluding D&A&I, LTI, share-based
payments and the impact of the Karusel transformation under IFRS 16 as a
percentage of revenue decreased by 58 b.p. to 13.4% (decreased by 95 b.p. to
17.5% pre-IFRS 16), mainly driven by lower staff costs, utilities, other store
costs and third-party services.
Lease/sublease and other income(8)
As a percentage of revenue, the Company's income from leases, subleases and
other operations under IFRS 16 totalled 0.9%, a decrease of 13 b.p.
year-on-year in Q2 2022 (a decrease of 12 b.p. to 0.8% pre-IFRS 16), due to
lower fixed lease/sublease fees as percentage of revenue on the back of
accelerated revenue growth in Q2 2022 under pre-IFRS 16.
EBITDA and EBITDA margin
IFRS 16 Pre-IFRS 16
RUB mln Q2 2022 Q2 2021 change, Q2 2022 Q2 2021 change,
y-o-y, %
y-o-y, %
Gross profit 167,016 140,096 19.2 164,957 138,090 19.5
Gross profit margin, % 25.8 25.6 14 b.p. 25.5 25.3 19 b.p.
SG&A (excl. D&A&I, LTI, share-based payments and the effect of the (81,989) (73,864) 11.0 (108,144) (97,769) 10.6
Karusel transformation)
% of revenue 12.7 13.5 (86) b.p. 16.7 17.9 (120) b.p.
Net impairment losses on financial assets 288 (9) n/a 288 (9) n/a
% of revenue 0.04 0.00 5 b.p. 0.04 0.00 5 b.p.
Lease/sublease and other income (excl. the effect of the Karusel 5,698 5,505 3.5 5,275 5,112 3.2
transformation)
% of revenue 0.9 1.0 (13) b.p. 0.8 0.9 (12) b.p.
Adj. EBITDA 91,013 71,728 26.9 62,376 45,424 37.3
Adj. EBITDA margin, % 14.0 13.1 92 b.p. 9.6 8.3 132 b.p.
LTI, share-based payments and other one-off remuneration payment expenses and (685) (1,184) (42.1) (685) (1,184) (42.1)
SSC
% of revenue 0.1 0.2 (11) b.p. 0.1 0.2 (11) b.p.
Effect of the Karusel transformation (176) (211) (16.6) (176) (211) (16.6)
% of revenue (0.03) (0.04) 1 b.p. (0.03) (0.04) 1 b.p.
EBITDA 90,152 70,333 28.2 61,515 44,029 39.7
EBITDA margin, % 13.9 12.9 104 b.p. 9.5 8.1 144 b.p.
IFRS 16 Pre-IFRS 16
RUB mln H1 2022 H1 2021 change, H1 2022 H1 2021 change,
y-o-y, %
y-o-y, %
Gross profit 317,446 269,637 17.7 313,429 265,715 18.0
Gross profit margin, % 25.4 25.6 (24) b.p. 25.0 25.2 (19) b.p.
SG&A (excl. D&A&I, LTI, share-based payments and the effect of the (168,048) (147,545) 13.9 (219,703) (194,918) 12.7
Karusel transformation)
% of revenue 13.4 14.0 (58) b.p. 17.5 18.5 (95) b.p.
Net impairment losses on financial assets (147) (130) 13.1 (147) (130) 13.1
% of revenue 0.01 0.01 (0) b.p. 0.01 0.01 (0) b.p.
Lease/sublease and other income (excl. the effect of the Karusel 11,941 11,422 4.5 11,329 10,232 10.7
transformation)
% of revenue 1.0 1.1 (13) b.p. 0.9 1.0 (7) b.p.
Adj. EBITDA 161,192 133,384 20.8 104,908 80,899 29.7
Adj. EBITDA margin, % 12.9 12.7 21 b.p. 8.4 7.7 70 b.p.
LTI, share-based payments and other one-off remuneration payment expenses and (1,061) (1,606) (33.9) (1,061) (1,606) (33.9)
SSC
% of revenue 0.1 0.2 (7) b.p. 0.1 0.2 (7) b.p.
Effect of the Karusel transformation (423) (218) 94.0 (423) (218) 94.0
% of revenue (0.03) (0.02) (1) b.p. (0.03) (0.02) (1) b.p.
EBITDA 159,708 131,560 21.4 103,424 79,075 30.8
EBITDA margin, % 12.8 12.5 27 b.p. 8.3 7.5 76 b.p.
D&A&I
Depreciation, amortisation and impairment costs under IFRS 16 decreased as a
percentage of revenue by 82 b.p. year-on-year to 6.0% (down 33 b.p.
year-on-year to 3.1% pre-IFRS 16) in Q2 2022, totalling RUB 38,574 million
(RUB 19,996 million pre-IFRS 16). This was mainly driven by a lower number of
refurbishments compared to the same period of the previous year and higher
discount rates under IFRS 16 due to increased interest rates in Russian
capital markets on the back of a key interest rate increase. In H1 2022,
depreciation, amortisation and impairment costs under IFRS 16 decreased by 46
b.p. year-on-year to 6.5% (decreased by 8 b.p. year-on-year to 3.6% pre-IFRS
16), totalling RUB 81,940 million (RUB 44,799 million pre-IFRS 16).
Non-operating gains and losses
IFRS 16 Pre-IFRS 16
RUB mln Q2 2022 Q2 2021 change, Q2 2022 Q2 2021 change,
y-o-y, %
y-o-y, %
Operating profit 51,578 33,303 54.9 41,519 25,371 63.6
Net finance costs (18,253) (14,151) 29.0 (5,972) (4,195) 42.4
Net FX result 6,231 897 7x 2,352 390 6x
Profit before tax 39,556 20,049 97.3 37,899 21,566 75.7
Income tax expense (12,794) (5,129) 149.4 (12,457) (5,433) 129.3
Net profit 26,762 14,920 79.4 25,442 16,133 57.7
Net profit margin, % 4.1 2.7 140 b.p. 3.9 3.0 97 b.p.
IFRS 16 Pre-IFRS 16
RUB mln H1 2022 H1 2021 change, H1 2022 H1 2021 change,
y-o-y, %
y-o-y, %
Operating profit 77,768 57,803 34.5 58,625 42,239 38.8
Net finance costs (35,319) (27,516) 28.4 (11,782) (8,040) 46.5
Net FX result 2,937 777 4x 45 289 (84)
Profit before tax 45,386 31,064 46.1 46,888 34,488 36.0
Income tax expense (16,125) (8,506) 89.6 (16,424) (9,192) 78.7
Net profit 29,261 22,558 29.7 30,464 25,296 20.4
Net profit margin, % 2.3 2.1 20 b.p. 2.4 2.4 3 b.p.
Net finance costs under IFRS 16 in Q2 2022 increased by 29.0% year-on-year to
RUB 18,253 million (up 42.4% year-on-year to RUB 5,972 million pre-IFRS 16),
driven by increasing interest rates in Russian capital markets on the back of
a key rate increase and increasing interest on lease liabilities.
The positive net FX result totalled RUB 6,231 million (RUB 2,352 million under
pre-IFRS 16) in Q2 2022, compared with positive RUB 897 million (positive RUB
390 million under pre-IFRS 16) in Q2 2021 due to appreciation of the rouble
and the effect from revaluation of foreign exchange lease liabilities. As a
result, the positive FX effect of 1.0% of revenue (0.4% of revenue pre-IFRS
16) partially compensated negative pressure on net profit margin.
In H1 2022, the effective tax rate under IFRS 16 was 35.5% (35.0% under
pre-IFRS 16), up from 27.4% in H1 2021 (26.7% under pre-IFRS 16) due to the
one-off effect from provisions made in Q2 2022.
Consolidated cash flow statement highlights
IFRS 16 Pre-IFRS 16
RUB mln Q2 2022 Q2 2021 change, Q2 2022 Q2 2021 change,
y-o-y, %
y-o-y, %
Net cash from operating activities before changes in working capital 89,817 70,397 27.6 61,603 44,486 38.5
Change in working capital 5,699 998 6x 5,898 932 6x
Net interest and income tax paid (19,536) (18,685) 4.6 (7,245) (8,752) (17.2)
Net cash flows generated from operating activities 75,980 52,710 44.1 60,256 36,666 64.3
Adj. net cash used in investing activities(9) (15,058) (23,662) (36.4) (15,143) (24,086) (37.1)
Repayment of short-term financial investments 30,000 - n/a 30,000 - n/a
Net cash used in financing activities (105,309) (28,338) 4x (89,500) (11,870) 8x
Effect of exchange rate changes on cash and cash equivalents (309) (75) 4x (309) (75) 4x
Net increase in cash and cash equivalents (14,696) 635 n/a (14,696) 635 n/a
IFRS 16 Pre-IFRS 16
RUB mln H1 2022 H1 2021 change, H1 2022 H1 2021 change,
y-o-y, %
y-o-y, %
Net cash from operating activities before changes in working capital 160,574 130,804 22.8 104,909 79,509 31.9
Change in working capital (18,493) (3,917) 5x (17,996) (4,103) 4x
Net interest and income tax paid (39,945) (33,757) 18.3 (16,423) (14,327) 14.6
Net cash flows generated from operating activities 102,136 93,130 9.7 70,490 61,079 15.4
Adj. net cash used in investing activities(9) (37,025) (42,366) (12.6) (37,267) (42,790) (12.9)
Repayment of short-term financial investments 30,000 - n/a 30,000 - n/a
Net cash used in financing activities (82,343) (57,849) 42.3 (50,455) (25,374) 98.8
Effect of exchange rate changes on cash & cash equivalents (314) (75) 4x (314) (75) 4x
Net increase in cash and cash equivalents 12,454 (7,160) n/a 12,454 (7,160) n/a
In Q2 2022, the Company's net cash from operating activities before changes in
working capital under IFRS 16 increased by RUB 19,420 million (up RUB 17,117
million under pre-IFRS 16) and totalled RUB 89,817 million (RUB 61,603 million
under pre-IFRS 16), reflecting business growth. The positive change in working
capital under IFRS 16 of RUB 5,699 million in Q2 2022 as compared to Q2 2021
was driven by a higher decrease in account receivables due to lower bonuses
from suppliers and a higher increase in other accounts payable driven by
deferred social tax payments.
Working capital highlights (under IFRS 16)
RUB mln 30-Jun-22 31-Dec-21 30-Jun-21
Inventories 175,204 166,840 142,024
Trade, other accounts receivable and prepayments 12,921 20,190 16,801
Trade accounts payable 187,672 212,949 160,836
Provisions and other liabilities 97,827 104,673 87,330
Net interest and income tax paid under IFRS 16 in Q2 2022 increased by 4.6%
year-on-year (down 17.2% year-on-year pre-IFRS 16) and totalled RUB 19,536
million (RUB 7,245 million pre-IFRS 16), driven by lower income tax paid due
to prepayments made in previous periods.
As a result, net cash flow generated from operating activities under IFRS 16
totalled RUB 75,980 million in Q2 2022, up from RUB 52,710 million in Q2 2021
(RUB 60,256 million, up from RUB 36,666 million in Q2 2021 pre-IFRS 16).
In H1 2022, net cash flows generated from operating activities under IFRS 16
totalled RUB 102,136 million, up 9.7% from RUB 93,130 million in H1 2021 (and
totalled RUB 70,490 million, up 15.4% from RUB 61,079 million in 2021 pre-IFRS
16), driven by EBITDA growth and positive change in working capital.
In Q2 2022, adjusted net cash used in investing activities, which generally
consists of payments for property, plant and equipment, under IFRS 16
decreased to RUB 15,058 million (to RUB 15,143 million under pre-IFRS 16) due
to a lower number of refurbishments, the calendarisation of store openings and
capex optimization. For H1 2022, adjusted net cash used in investing
activities under IFRS 16 decreased to RUB 37,025 million (RUB 37,267 million
under pre-IFRS 16) from RUB 42,366 million (RUB 42,790 million under pre-IFRS
16) in H1 2021.
Net cash used in financing activities under IFRS 16 totalled RUB 105,309
million (RUB 89,500 million pre-IFRS 16) in Q2 2022, compared with RUB 28,338
million (RUB 11,870 million pre-IFRS 16) in Q2 2021. In H1 2022, net cash used
in financing activities under IFRS 16 increased to RUB 82,343 million from RUB
57,849 million (and increased to RUB 50,455 million from RUB 25,374 million
pre-IFRS 16) in H1 2021.
Liquidity update
RUB mln 30-Jun-22 % of total 31-Dec-21 % of total 30-Jun-21 % of total
Total debt 243,928 294,338 266,197
Short-term debt 60,490 24.8 87,767 29.8 76,274 28.7
Long-term debt 183,438 75.2 206,571 70.2 189,923 71.3
Net debt (pre-IFRS 16) 205,412 268,276 253,349
Net debt/EBITDA (pre-IFRS 16) 1.11x 1.67x 1.68x
Lease liabilities (IFRS 16) 558,072 577,363 568,689
Net debt/EBITDA (IFRS 16) 2.58x 3.16x 3.24x
The Company's net debt/EBITDA ratio under IFRS 16 was 2.58x (1.11x pre-IFRS
16) as of 30 June 2022.
The Company's debt pre-IFRS 16 is 100% denominated in Russian roubles.
As of 30 June 2022, the Company had access to RUB 442,948 million in available
credit limits with major Russian and international banks.
1. LFL comparisons of retail sales between two periods are comparisons
of retail sales in local currency (including VAT) generated by the relevant
stores. The stores that are included in LFL comparisons are those that have
operated for at least 12 full months. Their sales are included in the LFL
calculation starting from the day of the store's opening. We include all
stores that fit our LFL criteria in each reporting period.
2. The pre-IFRS 16 financial measures are calculated by adjusting the
applicable IFRS measures to include fixed lease expenses and fixed non-lease
components of lease contracts, and to exclude any gain on derecognition of
right-of-use assets and lease liabilities, depreciation of right-of-use assets
and interest on lease liabilities and gain/loss from sale of asset undersale
and leaseback operations for the proportion of the rights retained recognised
under IFRS 16.
3. Adjusted EBITDA is EBITDA before costs related to the LTI programme,
share-based payments, other one-off remuneration payment expenses and the
impact of the Karusel transformation.
4. Please note that, in this and other tables and in the text of this
press release, immaterial deviations in the calculation of % changes,
subtotals and totals are due to rounding.
5. Net retail sales represent revenue from the operations of X5-managed
stores net of VAT. This number differs from revenue, which includes proceeds
from wholesale operations, direct franchisees (royalty payments) and other
revenue.
6. Including Mnogo Lososya.
7. Including Vprok.ru Perekrestok dark stores and Mnogo Lososya dark
kitchens.
8. Mainly consists of lease/sublease income, income from the sale of
recyclable materials and other one-off gains.
9. Adjusted for repayment of short-term financial investments.
10. Adjusted short-term financial investments.
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: express delivery, 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
Head of Corporate Finance and IR
Tel.: +7 (495) 662-88-88 ext. 27-300
e-mail: Varvara.Kiseleva@x5.ru (mailto:Varvara.Kiseleva@x5.ru)
Maria Yazeva
Investor Relations Officer
Tel.: +7 (495) 662-88-88 ext. 13-147
e-mail: Maria.Yazeva@x5.ru (mailto:Maria.Yazeva@x5.ru)
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