April 28, 2014. Moscow, Russia - OJSC Detsky Mir ("Detsky Mir" or the "Company"), the largest children's goods retail chain in Russia, announces its financial results for the 1st quarter ended March 31, 2014[1].

1st QUARTER 2014 FINANCIAL HIGHLIGHTS 

- Total number of stores increased from 252 to 258 driven by 3 new Detsky Mir branded stores and 3 new ELC branded stores

- Total selling space went up from 320 thousand sq. m. to 324 thousand sq. m.

- Net revenue up 35% compared to the 1st quarter 2013

- Like-for-like sales grew 24.9% (18.3% in number of tickets and 5.6% in average ticket)

- OIBDA for the 1st quarter 2014 is RUR 66.5million versus OIBDA for the 1st quarter 2013 of minus RUR 460.2 million

- Mar 2014 LTM OIBDA of RUR 3.3 billion, an increase of 97.3% year-on-year

- Net income for the 1st quarter 2014 is minus RUR 435.0 million versus minus RUR 595.1 million for the 1st quarter 2013

- Mar 2014 LTM net income of RUR 1.3 billion, an increase of 172.2% year-on-year 

Vladimir Chirakhov, Chief Executive Officer of Detsky Mir, commented: 

"During the 1st quarter of 2014 Detsky Mir demonstrated extremely positive sales dynamics despite the seemingly negative macroeconomic environment and consumer spending growth slowdown in Russia. Like-for-like growth was 24.9% mainly driven by an 18.3% increase in number of tickets. This result reflects positive changes we implemented in the way of merchandising, loyalty program and pricing policy improvement. 3 new Detsky Mir branded stores and 3 new ELC branded stores were opened during the 1st quarter 2014. All new Detsky Mir stores were and will be further opened under new concept that allows us to combine the selling and entertainment zones in the single store and that is especially in demand  in the children`s goods retail.

I would like to highlight positive OIBDA result of RUR 66.5 million that was achieved for the first time in the 1st quarter of the year, particularly on the back of minus RUR 460.2 million in the 1st quarter 2013.This result is a testament to the many operational improvements implemented by management team in the end of 2012 and during 2013. LTM OIBDA of RUR 3.3 billion grew 97.3% compared to the respective period of the previous year. OIBDA margin during this period increased from 5.7% to 8.6%

During 2014 we plan to maintain further positive like-for-like sales dynamics as well as to implement our development program and intend to open at least 30 new Detsky Mir branded stores and 10 new ELC branded stores".

[1] Financial results are based on management accounts.