O`KEY Group S.A. (LSE, MOEX: OKEY, the “Group” or the “Company”), one of Russia’s leading food retailers, has announced its unaudited operating results for the first quarter (Q1) of 2022.
Q1 2022 operating highlights
- Group net retail revenue increased by 9.3% YoY to RUB 47.3 bn in Q1 2022, driven by both hypermarkets and discounters LFL growth and supported by online sales and the discounter chain expansion.
- O`KEY hypermarkets’ net retail revenue stood almost flat YoY at RUB 35.9 bn in Q1 2022 vs RUB 36.0 bn in Q1 2021, primarily due to a selling space reduction. In Q1 2022, in the course of ongoing store portfolio revision and optimisation, the Group closed two O’KEY stores in Saratov and one supermarket in Moscow.
- DA! discounters continued to demonstrate one of the highest growth rates in the sector and delivered an impressive 57.6% YoY net retail revenue growth to RUB 11.4 bn in Q1 2022. This was driven by a 33.0% LFL net retail revenue increase and a 32.3% YoY expansion of selling space.
- DA! discounters’ share in the Group’s revenue rose by 7.4 pp YoY to 24.1% in Q1 2022.
- Total online sales grew by 64.5% YoY to RUB 1.6 bn and reached 4.5% of O`KEY’s net retail revenue in Q1 2022.
- The Group expects that the discounters and online business will continue to spearhead growth in the medium term.
Key events after the reporting date
- Current geopolitical situation and market volatility, attributable to the global economic environment, currency and stock markets, as well as substantial currency exchange fluctuations are presumed to affect companies across all the sectors of the economy. We are thoroughly analysing the possible influence of the evolving macroeconomic conditions and changes in the retail market on the O’KEY Group’s financial and operational results in mid-term and beyond.
For years, the Group has been cooperating with local producers: around 80% of the Company's purchases are accounted for by products made by Russian producers. This is specifically relevant in terms of evolving the O`KEY's and DA!’s own brands. The Company is also involved in developing programmes to support local producers and therefore takes part in regional and national quality initiatives, especially, in the Group’s core Northwest and Central regions of Russia.
Since March 2022, the Group has been redirecting logistics flows where necessary to provide uninterrupted supply and meet the demand of our customers. The Company makes best efforts to optimise logistic costs, provide effective inventory management and assure full on-shelf availability for its hypermarket and discounter chains, and online.
Despite the current situation, we strive to run our business smoothly offering our customers the best value proposition and impeccable service. We continue to implement our strategy and accomplish the goals. Our well-balanced business model and established corporate governance system offer a significant hedge against market volatility and enable us to serve the interests of all our stakeholders.
- In April 2022, the Group opened four new hypermarkets under the O’KEY brand in the Moscow Region to replace stores it had acquired from X5 Group.
The full text of the announcement is available at https://okeygroup.lu/press-center/press-releases/2022/1800/.
- In April 2022, the Company opened four new DA! discounters in the Central Federal District of Russia.