September 6, 2012. Moscow, Russia.Detsky Mir Group, the largest children's goodsretail operator in Russia and the CIS, has released its unaudited US GAAP financials for the six months of 2012 ended June 30, 2012.
FINANCIAL AND OPERATING HIGHLIGHTS
- The revenuefor the first 6 months of 2012 was RUB 10,649 mln (US$ 348mln), which is a 16.1% (8.5% in dollar terms) increase as compared to the same period of 2011.
- LFL sales throughout the retail chain grew by 9.1%as compared to the same period of 2011.
- Gross profit for the first 6 months of 2012 increased by 16.1% (8.5% in dollar terms) and reached RUB 3,915 mln (US$ 128mln).The gross margin remained unchanged at 36.8%.
- Selling and administrative expenses as a percentage ofrevenuedecreased by 2.2p.p.to 41.5%.
- Seasonal OIBDA loss was RUB 483mln (US$ 16 mln) for the first 6 months of 2012, which is a 22.8% decrease as compared to the same period of 2011.
- Retail space increased to 253,000 sq. m, or by 19.3% since June 30, 2011.
- The Group's net loss for the first 6 months of 2012 was RUB 868mln (US$ 28mln) and decreased by 0.3% as compared to the same period of 2011.
- As of June 30, 2012 there was a 7.6% reduction in the Group's net debt to RUB 3,210 mln (US$ 98 mln), as compared to June 30, 2011.
Gennady Lyovkin, CEO of the Detsky Mir Group, comments on the results for the first half of 2012:
"In 2011 Detsky Mir adopted a new development strategy involving active regional expansion and enhancement of the business's efficiency. In the first half of 2012 we focused our efforts on replicating the new retail concept and increasing retail space.
The Group's revenues are becoming more geographically diversified: since the year's start 15 new stores were opened in Russia and Kazakhstan, and retail space grew to 253,000 sq. m. Online sales also showed active growth with Detsky Mir online sales revenues more than doubling, delivery service coverage expanding fast, and new and extra services being added. Despite significant investment in developing the chain, seasonal OIBDAloss decreased as a result of steps taken to optimize operating expenses.
An important event after the reporting period was the acquisition of the Early Learning Centre (ELC) chain of stores franchise in Russia. This will help Detsky Mir enter the niche for increasingly popular early learningproducts, expand the product range thanks to new conceptual products, and also adopt the successful experience and retail techniques of the Western company."