18 November 2015. Russia, Moscow. OJSC Detsky Mir (hereinafter referred to as "Detsky Mir" or "the Company"), Russia's largest children's goods retailer, announces its unaudited financial results under US GAAP for 9M 2015 ended on 30 September 2015. 

KEY UNAUDITED FINANCIAL AND OPERATING RESULTS FOR 9M 2015

• OIBDA  increased from RUB 2 263 mln in the first 9 months of 2014 to RUB 2 940 mln in 9 months of 2015, and OIBDA margin amounted to 7.4%
• Revenue grew by 34.1% compared to 9M 2014, and reached RUB 40.0bn
• The Company opened 49 new stores, including 48 Detsky Mir stores and 1 ELC store
• Selling space reached 435,000 sq m in 9M 2015
• Like-for-like sales gained 13.8% (with the number of checks growing by 4.3%, and the average check growing by 9.1%)
• Gross profit grew by 26.7% in 9M 2015 to RUB 13.8bn; gross margin amounted to 34.6%
• Selling, general and administrative expenses to revenue ratio fell from 29.1% to 27.3% due to increased operating efficiency and measures taken to reduce costs
• Net income grew by 7.2% to RUB 657 mln compared to the same period of the last year
• The Company’s net debt totaled RUB 16.5 bn as of 30 September 2015.  The increase in net debt from the beginning of 2015 is due to the active development of the company's retail chain, the construction of a new distribution center and other investment projects

KEY UNAUDITED RESULTS FOR THE 12 MONTHS ENDED SEPTEMBER 2015. 

• OIBDA increased by 36.6% to RUB 5.6bn; OIBDA margin grew from 9.8% to 10.0%
• Revenue grew by 33.3% YoY to RUB 55.6bn
• The Company opened 74 new stores, including 71 DM stores and 3 ELC stores
• Selling space grew by 20.2%, from 362,000 sq m to 435,000 sq m
• Gross Profit increased by 26.3% to RUB 20.2bn; gross margin declined slightly from 38.3% to 36.3%
• Net income increased by 20.8% to RUB 2.1bn; net income margin amounted to 3.8%

Vladimir Chirakhov, CEO of Detsky Mir said:

"Despite the decline in consumer demand in the country, Detsky Mir keep high growth rates of key performance indicators of business.

The Company's revenue increased by more than 34,1% compared to the same period of last year. The main factor of high dynamics of revenue was a boost in sales in existing stores, which is reflected in a like-for-like growth of 13.8%. The significant growth of like-for-like sales is caused by increasing of the average check by 9.1%, while the number of purchases made (number of checks) in like-for-like stores increased by 4.3%.

OIBDA demonstrated an increase of 30% to RUB 2 940 mln. This result was obtained including by the operational improvements implemented by the Company's management. Improving the efficiency of business processes, optimising the product matrix, and revising the retail concept, and the transition to a single SAP platform reduced the share of sales, general and administrative costs as a percentage of revenue from 29% to 27%.

The Group continued to develop dynamically, opening new stores. For 9 months of 2015, we opened 48 DM stores and 1 store ELC, 19 of them - in the Moscow region. At the end of September 2015, DM stores are represented in 136 cities of Russia and Kazakhstan. One hundred stores will be opened in dozens of cities across the country in FY 2015.

E-commerce has a significant impact on business development of Detsky Mir. Revenue of e-commerce without in store- pick up increased by 2 times compared to the same period of last year and amounted to RUB 496 mln. For 9 months of 2015 OIBDA amounted to RUB 2.8 mln compared to the loss of RUB 15.0 mln in the last year."

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