Press Release Krasnodar April 20, 2018 PJSC Magnit Announces Unaudited 1Q 2018 Results Krasnodar, Russia (April 20, 2018): Magnit PJSC, one of Russia s leading retailers (MOEX and LSE: MGNT) announces its unaudited 1Q 2018 results prepared in accordance with IFRS 1. During 1Q 2018 Magnit added (net) 275 stores. The total store base as of March 31, 2018 reached 16,625 stores (12,283 convenience stores, 242 hypermarkets, 210 Magnit Family stores and 3,890 drogerie stores). Selling space increased by 13.24% in comparison to 1Q 2017 from 5.15 million sq. m. to 5.83 million sq. m. Revenue increased by 8.08% from 266.98 billion RUR in 1Q 2017 to 288.56 billion RUR in 1Q 2018. Gross Profit increased from 69.82 billion RUR in 1Q 2017 to 71.90 billion RUR in 1Q 2018. Gross Margin in 1Q 2018 was 24.92%. EBITDA in 1Q 2018 was 20.50 billion RUR. EBITDA margin in 1Q 2018 was 7.10%. Net Income in 1Q 2018 was 7.41 billion RUR. Net Income Margin in 1Q 2018 was 2.57%. According to Rosstat, CPI for the last 12M (April 2017 March 2018) was 2.4% compared to 4.3% for the same period in the previous year. According to Rosstat, food inflation for the last 12M (April 2017 March 2018) was 1.3% Y-o-Y vs 3.5% for the same period in the previous year. 1 Based on management accounts
1Q 2018 Monthly Operating Highlights: January Y-o-Y, % February Y-o-Y, % March Y-o-Y, % New Store Openings (NET) 61 n/a 67 n/a 147 n/a Convenience stores 26 n/a 40 n/a 92 n/a Hypermarkets 0 n/a (1) n/a 0 n/a Magnit Family 0 n/a 1 n/a 1 n/a Drogerie Stores 35 n/a 27 n/a 54 n/a Number of Stores (EOP) 16,411 n/a 16,478 n/a 16,625 n/a Convenience stores 12,151 n/a 12,191 n/a 12,283 n/a Hypermarkets 243 n/a 242 n/a 242 n/a Magnit Family 208 n/a 209 n/a 210 n/a Drogerie Stores 3,809 n/a 3,836 n/a 3,890 n/a New Selling Space, th. sq. m. 18.49 n/a 14.95 n/a 41.32 n/a Convenience stores 10.30 n/a 12.67 n/a 30.04 n/a Hypermarkets 0.00 n/a (5.90) n/a (1.99) n/a Magnit Family 0.00 n/a 0.95 n/a 0.53 n/a Drogerie Stores 8.19 n/a 7.23 n/a 12.74 n/a Total Selling Space (EOP), th. sq. m. 5,773.43 13.77% 5,788.37 13.49% 5,829.70 13.24% Convenience stores 3,968.36 14.70% 3,981.03 14.30% 4,011.07 14.00% Hypermarkets 701.62 2.86% 695.72 1.63% 693.73 1.34% Magnit Family 229.01 8.82% 229.96 10.16% 230.49 10.50% Drogerie Stores 874.44 21.05% 881.67 21.75% 894.41 21.48% Number of Customers, million 328.46 9.72% 315.95 8.13% 360.31 7.71% Convenience stores 277.98 10.54% 266.00 8.84% 303.28 8.29% Hypermarkets 19.18 0.45% 18.58 (0.40%) 21.54 0.21% Magnit Family 10.60 4.07% 10.28 5.15% 11.93 6.05% Drogerie Stores 20.69 11.34% 21.10 8.86% 23.57 8.48% Retail Sales 2, million RUR 91,649.13 7.58% 90,618.94 6.27% 102,659.09 9.09% Convenience stores 69,887.48 9.26% 68,121.29 7.69% 77,291.68 10.32% Hypermarkets 10,713.54 (3.34%) 10,756.96 (4.48%) 12,386.39 (0.52%) Magnit Family 4,642.28 4.04% 4,672.58 4.76% 5,379.52 9.01% Drogerie Stores 6,405.82 12.80% 7,068.11 12.33% 7,601.49 14.08% Retail Sales 2, million USD 3 1,613.90 13.59% 1,595.06 9.24% 1,799.95 11.14% Convenience stores 1,230.68 15.36% 1,199.06 10.69% 1,355.18 12.40% Hypermarkets 188.66 2.05% 189.34 (1.82%) 217.17 1.35% Magnit Family 81.75 9.85% 82.25 7.68% 94.32 11.07% Drogerie Stores 112.80 19.10% 124.41 15.47% 133.28 16.23% 2 Excluding wholesale 3 Based on the average exchange rate for January 2018 56.7875 RUB per 1 USD, February 2018 56.8124 RUB per 1 USD, March 2018-57.0344 RUB per 1 USD
1Q 2018 Operating Highlights: 1Q 2018 1Q 2018 Y-o-Y, % New Store Openings (NET) 275 250 n/a Convenience stores 158 188 n/a Hypermarkets (1) 0 n/a Magnit Family 2 (5) n/a Drogerie Stores 116 67 n/a Number of Stores (EOP) 16,625 14,309 n/a Convenience stores 12,283 10,709 n/a Hypermarkets 242 237 n/a Magnit Family 210 189 n/a Drogerie Stores 3,890 3,174 n/a New Selling Space, th. sq. m. 74.76 80.32 n/a Convenience stores 53.01 66.22 n/a Hypermarkets (7.88) 0.87 n/a Magnit Family 1.47 (4.17) n/a Drogerie Stores 28.16 17.40 n/a Total Selling Space (EOP), th. sq. m. 5,829.70 5,147.99 13.24% Convenience stores 4,011.07 3,518.62 14.00% Hypermarkets 693.73 684.54 1.34% Magnit Family 230.49 208.59 10.50% Drogerie Stores 894.41 736.24 21.48% Number of Customers, million 1,004.72 926.08 8.49% Convenience stores 847.26 775.95 9.19% Hypermarkets 59.30 59.24 0.10% Magnit Family 32.80 31.20 5.12% Drogerie Stores 65.36 59.69 9.49%
LFL Results Formats 1Q 2018-1Q 2017 4 # of Stores Average Ticket Traffic Sales Convenience Stores 9,614 (0.07%) (3.76%) (3.83%) Hypermarkets 228 (2.96%) (1.96%) (4.86%) Magnit Family 173 (0.35%) (2.81%) (3.15%) Drogerie 2,947 4.53% (4.24%) 0.10% Total 12,962 (0.01%) (3.64%) (3.65%) 4 LFL calculation base includes stores (all formats), which have been opened 12 months prior to the last month of the reporting period. i.e. by March 1, 2017.
1Q 2018 Key Financial Results, million RUR 1Q 2018 1Q 2017 Growth Rate Net Sales 288,561.37 266,983.08 8.08% Convenience stores 215,300.46 197,282.06 9.13% Hypermarkets 33,856.90 34,797.73 (2.70%) Magnit Family 14,694.38 13,857.09 6.04% Drogerie Stores 21,075.42 18,634.44 13.10% Wholesale 3,634.21 2,411.76 50.69% Gross Profit 5 71 902.52 69 822.56 2.98% Gross Margin, % 24.92% 26.15% n/a EBITDAR 33,090.23 31,621.20 4.65% EBITDAR Margin, % 11.47% 11.84% n/a EBITDA 20,500.38 20,995.41 (2.36%) EBITDA Margin, % 7.10% 7.86% n/a EBIT 11,727.76 12,910.15 (9.16%) EBIT Margin, % 4.06% 4.84% n/a Net Income 7,405.13 7,543.09 (1.83%) Net Income Margin, % 2.57% 2.83% n/a 5 Starting in 2018 Magnit has revised its accounting policy and now includes Handling Costs into the Cost of Goods Sold (COGS) section of the Income Statement. Previously, Magnit included Handling Costs into the Selling, General and Administrative (SG&A) section. For the sake of comparison, Magnit has applied the same accounting change for Q1 2017 Gross Profit and Gross Margin figures in this press release.
1Q 2018 Key Financial Results, USD million 6 1Q 2018 1Q 2017 Growth Rate Net sales 5,073.13 4,537.70 11.80% Convenience stores 3,785.15 3,353.05 12.89% Hypermarkets 595.23 591.43 0.64% Magnit Family 258.34 235.52 9.69% Drogerie Stores 370.52 316.72 16.99% Wholesale 63.89 40.99 55.87% Gross Profit 1 264.10 1 186.72 6.52% Gross Margin, % 24.92% 26.15% n/a EBITDAR 581.75 537.44 8.24% EBITDAR Margin, % 11.47% 11.84% n/a EBITDA 360.41 356.84 1.00% EBITDA Margin, % 7.10% 7.86% n/a EBIT 206.18 219.42 (6.03%) EBIT Margin, % 4.06% 4.84% n/a Net Income 130.19 128.20 1.55% Net Income Margin, % 2.57% 2.83% n/a Notes: 1) Net revenue in USD terms is calculated using the average exchange rate for the period. 2) This announcement contains inside information which is disclosed in accordance with the Market Abuse Regulation which came into effect on 3 July 2016. 3) Please note that there may be small variations in calculation of totals, subtotals and/ or percentage change due to rounding of decimals. 6 Based on the average exchange rate for 1Q 2018 56.8803 RUB per 1 USD, 1Q 2017 58.8366 RUB per 1 USD
For further information, please contact: Timothy Post Dina Svishcheva Media Inquiries Head of Investor Relations Email: post@magnit.ru Office: +7-861-277-4554 x 17600 Deputy Director, Investor Relations Email: Chistyak@magnit.ru Office: +7-861-277-4554 x 15101 Media Relations Department press@magnit.ru Company description: Public Joint Stock Company Magnit is one of Russia's leading retailers. Founded in 1994, the company is headquartered in the southern Russian city of Krasnodar. As of March 31, 2018, Magnit operated 37 distribution centers and 16,625 stores (12,283 convenience, 242 hypermarkets, 210 Magnit Family stores and 3,890 drogerie stores) in 2,764 cities and towns throughout 7 federal regions of the Russian Federation. In accordance with the audited IFRS results for 2017, Magnit had revenues of RUB 1,143 billion and an EBITDA of RUB 92 billion. Magnit's local shares are traded on the Moscow Exchange (MOEX: MGNT) and its GDRs on the London Stock Exchange (LSE: MGNT) and it has a credit rating from Standard & Poor's of BB. Measured by market capitalization, Magnit is one of the largest retailers in Europe.